5 things you should consider before opening a Merchant account

The merchant community is the most vibrant community at the moment, they are driving the next level of growth which can be seen with the increasing trend of UPI and other payments adoption in India. As a consequence, the financial industry has responded by coming up with various solutions which solve for various merchant needs.

Acceptance of digital payments is the most popular of offerings but then you also have competing Fintechs getting on to the bandwagon with their beyond payments offering like inventory management, khaata book, accounting etc. However, there seems to be a fundamental disconnect in terms of looking at the merchant needs from a holistic perspective.

As we know, a merchant is a small business owner who is expected to spend>90% of his/her time on the shop counter. Having to deal with multiple apps takes away his / her most precious resource i.e. time. Hence these app solutions start impacting their business negatively, exactly opposite of what they intended to do.

I have analysed multiple apps and would like to highlight the 5 basic features that merchants need from a app

PS: Any institution which fulfils this will be immensely successful.

Here we go!

1. 1. Paperless onboarding – In this Digital Age, asking for paper is akin to blasphemy. The app should use the digital tools made available by the government to bring the merchants onto the platform.
   2. Easy to use Current account – While payment players have solved for payments, ou everyday merchant still struggles in accessing the business account
   3. Accept payment through all modes – UPI may be the greatest invention but it too has its limitations. The world is full of people who use different modes and a merchant app should provide for all the popular ones atleast.
   4. Banking – Collecting payments is very easy but how does one manage banking, make payments to vendors, apply for a chequebook, change address on account etc.? Clearly, another app for each banking need is unnecessary.
   5. Loans – When the transactions on the account are readily available to the financial institution and they can assess the customer’s credit worthiness much better than traditional methods of looking at dated ITR/Bureau reports, it makes sense to offer loans through the same app.

   While these look like simple needs, solving for all of them in a form which is convenient to the merchant segment is tough but Indus Merchant Solutions seems to be one of apps in the industry which seems to be taking the right steps in this direction. Do check it out.