BookMyForex.com is a Marketplace for Currency Exchange and International Remittances. Its app compares exchange rates and service quality metrics across hundreds of banks and exchange companies and connect the customer with the most ideal forex provider in real time. The BookMyForex platform operates like the stock market and seeks to bring about way more transparency by updating rates every three seconds.
Currently, the company offers its service from over 5000 Bank & exchange company branches and 650+ cities in India. It has 42 channel partners including Banks and the firm is planning to add another 75 more business partners in next three months.
All fx products except cash currency on its platform are linked to live interbank rates and are bought and sold at exact interbank rates that you see on business channels or fx apps or extremely close to it.
BookMyForex has so far completed over 1, 50,000 transactions and its business has grown over 250% in last six months. The company was incepted in November 2012 and came to being as a marketplace in August 2014. It was launched by Father-Son duo - Sudarshan Motwani, CEO & Nitin Motwani, CTO, BookMyForex.
BWDisrupt team member Sujata Sangwan interacts with Sudarshan Motwani, CEO & Founder, BookMyForex, and spoke to him
What inspired you to start this business?During my tenure at various Banks as Head of Foreign Exchange Services, I often thought about the impossible situations that our customers faced with respect to rates of foreign currency that have been opaque ever since. For instance, a customer who wants to buy forex from a physical store and if he/she was to go to 10 forex dealers will end up with 10 different and wildly varying rates, even if those were to be 10 different branches of same exchange company or banks.
To begin with online travel agencies, revolutionize the travel segment by offering on line ticketing; followed by online hotel booking and soon all other travel related products were the first to catch the online fever. The only product in the travel segment that was NOT online was the "forex" that any traveler would need the most! Hence BookMyForex.com came into existence.
Unique Key PointsBookMyForex application combines all advanced features of e-commerce as well as that of live stock brokerages to offer its customer live fx rates for the very first time anywhere in the world.
We have a process driven work flow that controls transaction from start to finish and until customer is fully satisfied. We take pride in our work culture that is full of enthusiasm at the back of our success and are a near zero attrition company.
USPs of BookMyForex.com:• compares exchange rates and service quality metrics across hundreds of banks and exchange companies and connects the customer with the most ideal forex vendor in real time that saves our customers between 2 to 5% in costs apart from ensuring quality service that is tracked all the time.
• Website offers real time rates that updates every 3 seconds
• Options to freeze rates
• Options to set rate alerts
• Cash currency buying options from ATMs overseas using forex travel cards that save 1 to 3%
Funding We were boot strapped and angle funded for only Rs. 3.25 crores. We achieved break even with that small funding. We have now raised series A funding from a reputed PE in India to give boost to our growth story.
MonetizationWe have two income streams as of now:
• Exchange income: Agreement with our channel partners (bank and Exchange companies) covers settlement rates apart from service standards, transaction turnaround time (TAT), etc. Settlement rate is essentially a volume rates linked to interbank rates. This is an extremely fine rate provided, basis our very large volumes and transactions support to our channel partners from across country. The difference between customer rates on our portal and settlement rates is our “exchange margin / income”
• Merchant commission: We offer zero margin or exact interbank rates on forex travel cards that also come with three free ATM withdrawal due to which customers can buy cash currencies at exact interbank rates. Our income from this type of transaction is from share of merchant commission from card swipes that issuing Banks share with us.
Challenges FacedBeing first to conceptualize and introduce the idea of retail fx online anywhere in the world, our first challenge was that there were neither any customers looking for such a service on internet nor would the investors buy our story.
Hence search engine optimization or even Google ads weren't working well and there was no way we could advertise from tiny funding base that we had. We were lucky to have been covered by various media overtime and that slowly changed things in favor. Our commitment to unfailing service quality, amazing rate advantage slowly drew more customers and rest is all word of mouth that resulted into over 70% repeat / referral customers.
As we grow, we are getting a lot better. Our business volumes are now important to our channel partners as we race to become country’s fifth or sixth highest distributors of forex travel cards in matter of a year and a few months. This means there is more competition on our dash board where channel partners compete with each other to provide best rates that our customer get to see.
Channel partners also have to compete to be on top of customer service metrics and hence we improve overall quality of service as well as the cost advantage for our customers.
To substantially increase the customer acquisition, we focused on various tools of digital marketing. Our growth mainly came from the high levels of customer satisfaction which generated significant word of mouth and created the base for repeated business from them. Since, high level of customer satisfaction has taken us to higher growth trajectory; we aim at providing best in class experience for all our customers.
Market OpportunityAs per RBI data, the size of opportunity from the retail forex and overseas remittances business is Rs. 3,75,000 crores. Globally this figure stands at approximately $2 trillion.
Retail forex in India hasn’t had a leader in the sense that the largest player in the segment has just about 6% market share.
Most money changing set ups in India are small, usually family / proprietorship companies and hence there is a lot of inconsistency in service standards and rates leading to rate haggling and at the end customer mostly feel that they couldn’t manage the best deal.
An online marketplace for foreign exchange is in the interest of everyone connected with this business and most importantly in the interest of the consumer. This is because today there is no transparency in rates to the extent that 10 money changers in the same market will offer 10 different rates; worse still is the fact that 10 branches of the same money changer may also offer 10 different rates. Fluctuation can be wild and as much as one rupee or more for a US Dollar which can cause a huge dent in the budget of travelers. It is even worse for other currencies.
At the same time, it is not easy for a small money changer to bring retail clients to its store. BookMyForex now gets millions of customers on its site and is one of largest sources of business for many exchange companies and Banks.
Traction NumbersWe are heading towards $100 million this financial year that is almost 300% growth YoY, we are getting close to 200,000 customer mark and we now cover 650 cities as opposed to about 125 cities only a few months back. In certain products like forex travel cards our growth has been spectacular 500% YoY.
What advice you want to share with the new entrants in this space?This is extremely easy segment to enter but to get traffic on a site and for customers to actually trust and do a transaction using online fx portal would require building trust in the minds of customers that is not easy at all. Too many players in online fx marketplace have come and gone and there are many off line players trying to undercut their own branches to somehow enter online fx space and some other have no revenue model and are trying to build customer base hoping for VCs / investors to bail them out. These in our opinion will never work.
To be successful in online retail forex business, one has to create great reputation of reliability and trust specially since the transaction size in retail fx is several times larger than normal e-commerce sites. Being a very low margin business with virtually no parallel in the world, not many VCs will pour in big money until the revenue model is verifiable, functional and exciting to the investor and the volume metrics is really good.
Also unlike most other online businesses, this business requires deep knowledge of the subject from relevant and significant experience in retail fx . Hence to succeed, one needs balanced team that is extremely good with IT that is extremely complex given that there are too many moving parts apart from product, distribution.
More than any of this, online retail fx needs patience to build brand that reflects trust and reliability as one can’t sell high value foreign exchange on the back of some tiny discounts here and there.
