This fintech app helps millennials get a headstart on wealth creationLibza Mannan
Gurugram-based Saveabhi is on a mission to make the millennial generation familiar with the saving and investment culture at an early age. Claiming to be a 21st century version of a piggy bank, the app helps users save and invest their spare change with ‘Save the Change’ feature.
At a glance
Founder: Priyank Barthwal, and Vikram Malhotra
Year it was founded: 2016
Where is it based: Gurugram
The problem it solves: Helps users to start early investments
Funding raised: Bootstrapped
With technology disrupting all sectors, finance is no way behind. In the last two years, fintech has taken a giant leap in India. Over 420 fintech startups have entered the market since 2016, making India the world’s fastest-growing fintech ecosystem, second only to the US, which has 305 new startups. From lending platforms, tech-enabled investment advisory firms to providing money management and digital payments services, fintech startups have been simplifying managing and growing wealth through the power of technology.
One such startup is Saveabhi that intends to make savings and investments frictionless, helping users to grow their money wisely.
When Priyank Barthwal (35) saw people trusted prepaid mobile wallets for transactional purposes, he got concerned about where the finance industry was heading. Observing the spending trends of the current generation, Priyank realised that millennials have a very active social lifestyle and their expenses are quite large. So by the time they hit mid-30s, they realise that their financial freedom is still far away. Then starts a vicious cycle of expenditure and guilt, which disrupts the happiness quotient.
“Millennials have endless temptations to spend. Impulsive spending is very common, linking saving to spending is the only practical way to enable regular savings. Also, the majority of people procrastinate and let excuses like insufficient income, busy schedule and complexity of investment decisions seep in, diverting their focus from saving and investing,” Priyank adds.
Backed by extensive experience in the financial sector, Priyank along with his Vikram Malhotra decided to create a business model, which could link expenses and savings. Thus came about Saveabhi. The app’s prime feature is ‘Save the Change’, which allows users to save some extra money for small investments.
Saveabhi offers two mutual fund schemes for new investors who are more likely to starting their investment journey via ‘Save the Change’ feature. The first one is a conservative scheme for users who do not want to take too much risk and are comfortable with lower but consistent returns. The second scheme is an aggressive equity scheme for users who want to get higher returns and do not mind little ups and downs in between.
For more seasoned investors, Saveabhi offers SIP and lump sum investment options offering several schemes from multiple asset management companies (AMCs).
Founded by financial experts
“We ensure that we have a mix of right experience in terms of investment management, distribution and technology. Vikram brings rich distribution experience through his stints with large AMCs and I have good experience in technology and financial markets,” Priyank explains.
Priyank is a BTech from IIT Delhi and has worked both in large matrix of organisations and startups and has accumulated considerable expertise across multiple areas. He was associated with GH Financials, one of the largest clearing houses of LIFFE (London International Financial Futures and Options Exchange), and worked at Future First as a senior derivative trader dealing in trading,financial markets, market prediction and fundamental analysis.
Vikram has spent more than 15 years in the investments industry. He has worked with the country’s largest wealth creators witnessing several individuals attempt to achieve their financial goals. His last assignment was an 11-year stint working for ICICI Prudential Mutual Fund, where he was their Business Head for North.
‘Spare the Change’, a boon for millennials
Every time a user does a digital transaction, the Saveabhi app rounds up that amount to the next hundred and puts that extra change into an investment account. Let’s understand this with the help of an example. Suppose a user takes an Uber ride for Rs 230, Saveabhi would round that up to Rs 300 and take the extra Rs 70 and put it in his/her virtual investment piggy bank.
Once the amount in the virtual account crosses Rs 500, that amount will be debited from user bank account and will be invested in MF. Priyank reveals that they are also working on bringing down this threshold value to Rs 100.
To deliver on its promise of simplifying small savings, the platform introduced features for expense tracking and budgeting, which basically creates a saving capacity.
This video briefs you on how Saveabhi can help an average millennial start his/her investment journey with small investments.
Creating a niche
According to NASSCOM, the Indian fintech market is expected to grow at a CAGR of 22 percent for the next five years. Another KPMG report states that the transaction value for the Indian fintech sector was estimated to be approximately $33 billion in 2016 and is expected to reach $73 billion by 2020.
Currently, all major financial institutions have launched their own apps for ease of investing on-the-go, which includes IPRUTouch by ICICI Prudential, InvesTap by SBI Mutual Funds, and others. Some of the other popular fintech apps helping users invest their money wisely include including Sripbox, Piggy, KTrack by Karvy, ETMoney by Times Group, and Fisdom, among others
However, Saveabhi, which already claims to have a significant penetration with 12,000 users with engagement rates within a period of four months, seems confident that the startup’s continued focus on small savings and innovative offerings like ‘Save the Change’ will help the platform to create its own niche among other players.
Priyank also highlighted that initially, the platform witnessed significant traction only from metros especially Delhi. But now as Saveabhi is gradually establishing its foothold in the market, the platform's user base is expanding to Tier 2 cities like Kanpur as well.
Decoding plans for future
Currently, Saveabhi is bootstrapped and has no plans to raise funds as of now. Though the company was incepted in 2017, the platform spent six months in beta testing and launched the app only in January 2018.
Talking about revenues, Priyank says, “It is very early to talk about revenues but our average annual revenue acquired from per customer is higher than most other digital companies in India.”
Going ahead, the startup intends to add distribution channels and more asset classes for investment and is also looking to build an advisory business.