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RBI opens interoperable tokenisation for all: No edge for Apple and Google

EntrackrEntrackr · 1m ago
RBI opens interoperable tokenisation for all: No edge for Apple and Google
Medial

The Reserve Bank of India (RBI) has fired a shot across the bow of global tech giants by mandating that tokenisation and authentication services must be offered on an open, interoperable basis. In its newly issued Authentication Mechanisms for Digital Payment Transactions Directions, 2025, the regulator has directed that if a device or operating system enables tokenisation, the feature must be accessible to all apps and payment providers in that ecosystem, not just to the company that owns it. This move has significant implications for players like Apple Pay and Google Pay, which globally enjoy a competitive edge by locking core features such as NFC chips, secure elements, or tokenisation frameworks within their own apps. On the iPhone, for example, only Apple Pay can use the device’s NFC chip and tokenisation infrastructure, effectively sidelining third-party apps and giving Apple a gatekeeper role in mobile payments. This strategy has helped Apple capture a premium share of digital transactions in markets like the US and Europe, where regulators are still grappling with the anti-competitive impact. RBI’s mandate disrupts this model. By insisting on open access, the regulator is emphasizing that if tokenisation is available on a device in India, then PhonePe, Paytm, or an SBI app must be allowed to use it on equal terms. This could transform the competitive dynamics of India’s payments ecosystem, preventing big tech companies from ringfencing critical infrastructure and ensuring that Indian fintechs are not locked out of advanced authentication technologies. Tokenization, which replaces sensitive card numbers with randomly generated “tokens” during transactions, has become the global standard for securing payments. While Apple and Google have leveraged it to build dominance in their respective ecosystems, RBI’s framework ensures that no single player can monopolise tokenisation in India. In effect, India is one of the few large markets to pre-emptively curb walled gardens in digital payments, a regulatory stance that could give local fintechs a level playing field while forcing global giants to open up their closed ecosystems if they want to operate in the country.

Neobank unicorn Open posts Rs 46 Cr revenue in FY25; outstanding losses mounts to Rs 1,921 Cr

EntrackrEntrackr · 20d ago
Neobank unicorn Open posts Rs 46 Cr revenue in FY25; outstanding losses mounts to Rs 1,921 Cr
Medial

Fintrackr Neobank unicorn Open posts Rs 46 Cr revenue in FY25; outstanding losses mounts to Rs 1,921 Cr Once hailed as India’s first neobanking unicorn, Open is yet to live up to its hype. The startup's revenue is still under Rs 50 crore in FY25, while the bottom line for the Bengaluru-based firm is in the red with over Rs 100 crore during the fiscal year ending March 2025. Open’s revenue from operations increased 85% to Rs 46 crore in FY25, compared to Rs 24.8 crore in FY24, its annual financial statements sourced from the Registrar of Companies (RoC) shows. The company builds digital payment solutions that offer businesses a fully digital current account along with a suite of integrated tools for finance, accounting, and credit, all in collaboration with banking and lending partners. Open’s revenue in FY25 mainly came from subscription-based digital payment services and commission income on a pay-per-use model, which contributed Rs 46 crore. It also added Rs 12.1 crore from interest on deposits (non-operating), thanks to its healthy cash and bank balance, which helped lift its total revenue to Rs 58.1 crore during the fiscal year. For the neo-bank platform, employee benefits formed 62.5% of the total burn, which stood at Rs 100 crore in FY25, while its software expenses were recorded at Rs 18.3 crore. Its legal/professional, advertising cum marketing, commissions, travel, insurance, and other overheads stretched the overall expenses to Rs 160 crore in FY25. The 85% increase in revenue and reduction in employee benefits helped Open to reduce its losses by 35.8% to Rs 108.8 crore in FY25, compared to Rs 169.6 crore in FY24. The accumulated losses for the Tiger Global-backed startup mounted to Rs 1,921 crore ($225 million) till FY25. Open’s expense to revenue ratio improved this year, while ROCE and EBITDA margin recorded at -56.6% and -235.65% respectively. The company has a current total assets of Rs 210 crore, including cash and balances of Rs 202 crore by the end of the previous fiscal year (FY25). According to the startup data intelligence platform TheKredible, Open has raised over $190 million across rounds, including its $50 million round led by IIFL and with the participation of Tiger Global, where the company turned Unicorn in 2022. Open’s FY25 numbers highlight the stark reality facing India’s neobank sector. Despite unicorn valuations and massive funding, regulatory restrictions on digital lending, FLDG arrangements, and prepaid credit lines, combined with high employee costs and intense competition from traditional banks, have made profitability a distant goal. Rapid user growth alone no longer guarantees success for all the neo-banking platforms. For growth, Open and other neobanks will need to broaden their playbook beyond basic banking services. This could include expanding into lending for SMEs, wealth management, insurance distribution, or SaaS-based finance tools, leveraging their existing customer relationships. Given the regulatory circumstances and investor pressure, the growth in this particular category seems distant.

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