Omkar Shirhatti is the Co-founder and CEO at Karza Technologies, a state-of-the-art banking and business intelligence solution provider, set out to create cutting-edge products that empower lending institutions and corporations with cloud-based solutions for informed and intelligent decisions. Omkar, in his current leadership capacity, spearheads the research and development and product development aspect at the organization.
The Coronavirus pandemic has spurred a transformation in the way businesses operate, with government-mandated restrictions on travel and movement, and social distancing norms resulting in a limitation on staffing at banks, corporates and other businesses. Given the new reality the world finds itself living in, digitization has become a requirement for continuing to do business. Digital solutions are accelerating the revival of economic activity, and have been found to be convenient, cost-effective, efficient, and are increasingly becoming a mainstay of the recovering economy.
Micro, Small and Medium enterprises, which collectively constitute over 30% of India’s GDP, appear to be among the worst affected by the pandemic, with low internet penetration and a reliance on traditional models making these businesses highly dependent on a large workforce and thereby unsuited to the sudden shift to a primarily digital economy. They also have limited access to credit,
Identification and Authentication serve important roles, both, as a means of ensuring credit availability to businesses that have been hit hard by COVID, and as regulatory compliance for certain services offered by companies in specific industries.
Services Sector: VideoKYC and digital processes are the new normal
Industries such as Banking, e-commerce, insurance, Financial services, virtual marketplaces as well as shared-economy services rely heavily on the validation and Authentication of customer submitted information. Previously, verification of this data was performed through manual processes and in-person visits where information was collected.
Fortuitously, the Reserve Bank of India amended its guidelines for KYC procedures earlier this year, to permit VideoKYC as a fully digital onboarding mechanism. The RBI acknowledged the growing demand among financial and other service providers to streamline digital authentication procedures while realizing its potential vis-à-vis India’s digital inclusion agenda. Further to this, the replacement of OSV procedures with VideoKYC addresses some of the biggest challenges faced by companies when it comes to onboarding ‘new to credit’ customers.
Digital identity authentication solutions are more robust, efficient and cost-effective than traditional methods and are free from the problems of human bias and error. The adoption of digital onboarding and identity verification solutions has also significantly reduced the incidence of Identity fraud, a problem that has plagued the Indian economy, and could not be fixed through manual processes alone.
Financial Institutions will now be able to offer a diverse range of lending options to the ‘new to credit’ customer base, owing to the high levels of accuracy achieved through digital KYC procedures.
Making Credit Accessible
The total addressable MSME Lending gap in India is estimated to be a whopping Rs. 25.8 Trillion. With the rise of alternate lending in India, the reason for the lack of credit to MSME’s is not so much that institutions are unwilling to lend to MSME’s, but rather that they lack the access to data and intelligence that would enable lending to these underserviced, new-to-credit customers.
This lack of access to credit has hindered the growth of India’s MSME’s, which contribute significantly to India’s GDP, consequently hindering India’s economic growth as well. Recognizing the issue of a lack of credit, several startups have developed innovative solutions using alternate data points, including statutory registration and compliance information, GST and ITR report to give Financial Institutions access to authentic data and a framework in which they can assess the creditworthiness of a business. This will be further complemented by the soon to be launched Account Aggregator ecosystem, which will significantly reduce the credit risk when loaning out to sole proprietorships, partnerships, etc. by merely allowing access to credible and intelligent information through a single, unified portal, enabling access to authentic data.
State-of-the-art automated authentication mechanisms and unified data intelligence can unlock the immense growth potential of Indian MSMEs, and turn-around India’s post-COVID economic prospects, just by making businesses adopt digital Authentication and verification of data.
Karza Technologies is one of India’s leading KYC verification companies and VideoKYC service provider and has also launched sophisticated Diligence, GST and ITR products to provide authentic data and intelligent analytics to financial institutions, increasing their potential customer base while simultaneously minimizing the risk of fraud.
More About Omkar Shirhatti
As an adroit chartered account professional, Omkar Shirhatti holds a prolific experience over 12 years in the fields of fraud investigations, background checks, he utilizes the knowledge of 500+ information sources and learning from 1500+ fraud cases that allow him to fuel the intelligent system that analyses available financial information with the institutions, and trawls the Internet for lurking signals that will raise a red flag about the borrowing outfit. He supervises the company’s efforts in combating rising NPAs and Loan Frauds with big data analytics, business intelligence and machine learning to carry out background checks, assesses the creditworthiness of borrowers not just on their track record but also on their future potential and intent to repay loans.
Omkar completed his B. Com in accountancy and audit from the prestigious RA Podar College of Commerce and Economics before pursuing his chartered accountancy in accounting and finance from the Institute of Chartered Accountants of India. Before co-founding Karza Technologies, he served as a senior consultant at Ernst and Young, a global leader in assurance, tax, transaction, and advisory services.
He envisions Karza emerging as the de-facto one-stop solution for the financial services ecosystem’s automation, onboarding, due diligence and monitoring requirements. He also envisages the company becoming a globally acclaimed name in the international finance frontier while churning out world-class fintech solutions that can make a veritable difference.
A self-made entrepreneur, Omkar loves reading comic books and graphic novels as they help in expanding his imaginative faculties.