After attracting interest from private equity players, the flourishing lending-to-the-poor operation of microfinance has lured data capture and smart-cards provider Bartronics India, which is giving the business more focus.
The technology firm was till now providing smart-cards to a few microfinance companies, but it has now developed its own software and will henceforth offer complete integrated software solutions.
It is also setting up a unit which will focus on microfinance-related business.
Sudhir Rao, managing director and chief executive officer, Bartronics India, told DNA Money, "Microfinance is driven by the smart-cards technology. We have been providing smart-cards for microfinance operations since the past one year. But the microfinance industry is expanding and so we see a demand for smart-cards expanding."
Bartronics is looking to tie-up with business correspondents and third-party administrators for microfinance and financial inclusion projects in India.
The firm is eyeing collaboration with banks, microfinance institutions and other non-governmental organisations that lend to the poor and track credit history via technology devices such as smart-cards and data readers.
"Some microfinance organisations and NGOs have approached us from South India," Rao said.
The firm is looking at a partnership model with third-party administrators (TPAs), as the model is more profitable for the firm than merely providing smart cards-alone, Rao said.
However, if the demand from microfinance fails to pick up, Bartronics has still kept its cushion of demand from the telecom industry, apart from setting the stage to bid for government-run projects.
"We have been offering the driving license on a smart-card in Maharashtra and West Bengal. We have projects in the pilot stage, such as the National Identification card, the PAN card, the railways SMART card and another card proposed by railway minister Lalu Prasad Yadav, which is yet to be named," Rao said.
"We have applied for tenders for 11 states for the Rashtriya Swasthya Bima Yojna (RSBY). These are big projects, so even if we get 3-4 of these, it would mean doubling our order book to Rs 1,000 crore from its current status," Rao said.
It would take 10 years to implement the complete system for RSBY. Bartronics will implement this across towns in association with a third party.
Bartronics has been able to submit tenders for these government projects only recently after it crossed the mandatory turnover of Rs 200 crore. "The firm has clocked a turnover of Rs 270 crore the last fiscal. So the biggest hurdle that we faced has been eliminated," Rao said.
Apart from government operated projects, there are other technology driven processes that are on the radar for Rao. "We have set up a technology centre which is creating technological applications for the future such as GPS and GPRS, which are meant for vehicle and personnel tracking," he added.