1.
Executive Summary
Business Name: BharatTransact Payment Solutions
Business Type: Digital payment platform targeting rural and underserved communities in
India.
Overview: BharatTransact focuses on filling the digital divide by providing a simple-to-
use, low-cost, and secure mobile payment service available on basic phones through USSD
and SMS technology. It addresses small-value transactions for daily needs, particularly where
internet-based solutions fail.
Key Features:
• Operates without internet via USSD/SMS.
• Multilingual and voice-guided instructions.
• Partnerships with local vendors and SHGs (Self-Help Groups).
• Real-time transaction tracking.
• Integration with bank accounts and mobile numbers.
Objectives:
• Launch MVP in 3 pilot districts within 6 months.
• Onboard 100,000 users in the first year.
• Achieve operational breakeven within 2 years.
Funding Requirement: ₹60 Lakhs (approx.)
Use of Funds:
• Tech development
• Field deployment
• Marketing
• Initial staffing
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2. Problem Statement
In spite of the headlong march of India's economy towards digitization, rural and semi-urban
communities continue to be left behind by systemic barriers. Much of the rural population
does not own smartphones or access the internet on a consistent basis, thereby being excluded
from the larger digital financial inclusion. Also, digital illiteracy is predominant in these
segments, and most people are new to or alienated by mobile app- or UPI-based platforms.
This exclusion leads to sustained use of cash payments, which are insecure, inefficient, and
frequently inaccessible for long-distance or emergency payments. Moreover, merchants here
face difficulties in using electronic payment solutions because of high setup fees, inadequate
infrastructure, and shortage of support infrastructures.
The problem is compounded by the discrepancy between current digital solutions, which are
designed for urban communities with access to 4G/5G networks, and the digital reality of
rural India, where a large majority continues to rely on 2G/3G-enabled phones. The absence
of inclusive fintech infrastructure creates financial inequalities, denies access to government
benefits paid digitally, and retards the economic progress of these communities.
It is critical that steps be taken immediately to bring in inclusive, simple-to-use digital
payment methods compatible with the constraints of rural users. Otherwise, millions of
Indians will remain excluded from the advantages of digital financial inclusion, slowing
national progress toward a cashless and digitally empowered economy.
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3. Proposed Solution
BharatTransact’s solution is a light, mobile-first digital payments system designed
specifically for feature phones. Utilizing USSD and SMS protocols, it allows secure, real-
time payments to be made without smartphones or an internet connection.
Main Elements of the Solution:
• Transaction Layer: USSD code and SMS command-based menu-driven interface.
• Merchant Ecosystem: Simple registration system for local shopkeepers and SHGs to
enable payments acceptance.
• Bank Integration: Smooth API integration with core banking systems to enable fund
transfers.
• Localized Support: Customer support and documentation in local languages with optional
voice guidance.
• Incentive Program: Cashback and referral rewards to entice and keep users as well as
vendors.
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4. Feasibility Analysis
Technical Feasibility: USSD and SMS infrastructures are ubiquitously installed by telecom
companies in rural India. The technologies are time-tested, secure, and inexpensive for
providing transaction services without internet connectivity.
Financial Feasibility: The project requires a small initial capital outlay with little dependency
on hardware. Its scalable nature provides incremental growth with corresponding investment.
Revenues may be obtained through micro-transaction charges and tactical banking/NGO
collaborations.
Operational Feasibility: Association with NGOs, local vendors, and Self-Help Groups
facilitates ease of on-ground deployment and user activation. Pilot areas in the initial stages
will facilitate validation and optimization of deployment plans.
Regulatory Feasibility: BharatTransact will follow RBI and NPCI guidelines rigidly to ensure
adherence to KYC norms and data security standards.
Challenges & Mitigation:
• Digital Illiteracy: Taken care of through on-ground training workshops.
• User Scepticism: Addressed through engagement of trusted local partners and provision
of transparent transaction histories.
• Telecom Dependency: Multiple service provider deals to provide redundancy in the
network.
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5. SWOT Analysis
Strengths:
• Internet-Independent Architecture: Works through USSD/SMS, and it becomes accessible
for users without smartphones or constant internet.
• Inclusive Design: Voice- and multilingual-enabled system guarantees access for various
populations.
• Scalability: Low infrastructure dependency enables quick scale geographically with
negligible marginal cost.
• Government Alignment: Complies with national goals such as Digital India and Financial
Inclusion Missions.
• Penetration at the grassroots level: Key alliances with Self-Help Groups (SHGs), local
NGOs, and kirana stores create local acceptance and trust.
Weaknesses:
• Reliance on Telecom Providers: The quality of service is dependent on USSD/SMS
dependability, which may change per location.
• First Resistance to Change: Existing users of cash will resist adopting digital channels in
spite of availability.
• Early-Stage Limited Revenue: Monetization is transaction volume with high dependence;
early-stage returns are likely to be small.
• Support and Training Needs: Ongoing investment in educating users, particularly for
digital literacy, is necessary.
Opportunities:
• Untapped Feature Phone Market: More than 300 million consumers continue to use
feature phones—a largely underserved segment.
• Banking Partnerships: Integration with private and public banks can unlock co-branding
and cross-promotion possibilities.
• Integration of Government Schemes: Ability to facilitate DBT (Direct Benefit Transfer)
and programs for welfare distribution.
• New Revenue Streams: Expansion in the future to microloans, insurance, or micro-
savings functionalities for rural consumers.
Threats:
• Erected Competition: Established players like Fintech heavy-hitters Paytm, Airtel
Payments Bank, and Fino may increase their rural concentration.
• Policy Changes: Abrupt changes in digital payment regulations or telecom tariffs can
affect the business.
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• Trust Deficit: Any technical glitch or misuse can undermine user trust immediately.
• Fraud & Security Risks: Even as offline-first, the system has to protect against
impersonation, phishing, and abuse.
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6. Market Analysis
Target Market:
• Rural individuals with basic phones.
• Local merchants, small vendors, SHGs.
• Users with Jan Dhan accounts but no digital access.
Demographics:
• Age: 25–60.
• Income: Low to medium.
• Geography: Rural/semi-urban.
User Personas:
• Sita Devi, a vegetable vendor in Bihar, does not own a smartphone but uses a keypad
phone.
• Raju, a mechanic in Maharashtra with a Jan Dhan account but no UPI app.
Market Size:
• ~300 million feature phone users in India.
• Over 800 million rural population.
Competitive Landscape: PayNearby, Fino Payments Bank, Airtel Payments Bank. Most
competitors focus on agent models or urban digital users.
Our Differentiator: Direct-to-user basic phone payments without needing agents.
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7. Stakeholder Analysis
End Users: Direct beneficiaries are rural feature phone users - farmers, street vendors,
homemakers, and daily-wage labourers. Their participation ensures demand-side verification
and ongoing feedback.
Partners:
• Microfinance Institutions: Offer trust, outreach, and assistance to onboard existing
borrowers.
• Local Vendors: Transaction nodes; critical for ecosystem activation.
• NGOs and SHGs: Community-level onboarding, training, and evangelizing partners.
Regulators:
• RBI & NPCI: Overarching oversight for compliance, transaction integrity, and license
approvals.
• Government Departments: Possible allies for public distribution system e-digitation and
subsidy disbursal.
Investors:
• Impact Investors & Social VCs: Inclusion-, sustainability-, and rural innovation-focused
investors.
• Grants & CSR Funds: Large corporates or development foundations aligned with
missions in financial literacy.
Telecom Providers: USSD/SMS gateway access, special short codes, and secure channels
partners. Scope of co-branded promotions.
Engagement Approach: Stakeholders will be involved through live demos, regional
workshops, multilingual marketing campaigns, and open reporting in order to build trust and
long-term partnership.
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8. Benefits
Quantitative Results:
• Decrease in Cash Dependence: Estimated 10–15% decrease in cash transactions during
first two years.
• User Acquisition Targets: 2 million active users in 24 months.
• Merchant Network Growth: 100,000 local merchants digitized in targeted districts.
• Transaction Value: Monthly volume expected to exceed ₹50 crores by Year 2.
Qualitative Results:
• Empowerment through Accessibility: Formerly excluded users now become independent.
• Safer Transactions: Minimizes risks involved with carrying money or robbery.
• Community Development: Enables financial inclusion and expansion for local
enterprises.
• Greater Trust in Formal Finance: Cultivates familiarity and trust with banks and online
interfaces.
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9. Costs
Items Estimated Costing Description
(INR)
Development (Technology + 25,00,000 Platform development, USSD/SMS
Infrastructure) systems, database, dashboards,
security layers.
Merchant Onboarding 10,00,000 Field teams, training, merchant kits,
onboarding materials.
Marketing & Education 15,00,000 Awareness drives, regional
campaigns, digital literacy
programs.
Support & Maintenance 8,00,000 Technical support, bug fixing,
multilingual helpdesk.
Legal & Compliance 2,00,000 Licensing, KYC norms, data policy
adherence.
TOTAL 60,00,000
Cost-Benefit Ratio: Return on investment projected at 2.5x in 3 years, supported by
transaction charges, vendor onboarding fees, and potential licensing deals with public sector
schemes.
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10. Risks
Category Risk Mitigation Strategy
Adoption Risk Low user uptake due to Continuous education, free
scepticism trial campaigns, local
champions
Regulatory Compliance Changing RBI/NPCI rules
Proactive legal consultations
and dynamic compliance
updates
Operational Reliability System downtime or SMS Use of multiple telecom
delivery failures gateways; automated
fallback protocols
Fraud & Security Identity fraud, SIM cloning Strong KYC processes, OTP
authentication, anomaly
detection system
Competitive Threat Entry by established players First-mover advantage,
into rural market hyper-localization, trust-
based partnerships
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11. Implementation Plan
Milestone Timeline Deliverables
MVP Development 0-3 Months Core transaction system,
USSD menu, SMS alerts,
limited pilot
configuration
Pilot in 3 Districts 4-6 Months Field team deployment,
training 500 vendors,
acquiring 10K users
Feedback and Iteration 7-8 Months User feedback
integration, vendor
insights, performance
tuning
Full Rollout – Phase 1 (state- 9-12 Months Launch in 1–2 high-
wise) priority states based on
pilot learnings
Full Rollout – Phase 2 (national- Year 2 Nationwide expansion
level) targeting high-density
rural populations across
12+ states
Resources:
• Product Team (Tech & UI): 1 Product Manager, 3 Developers
• Field Teams: 3 Teams of 4 (state-wise deployment & training)
• Support Team: 5 Multilingual customer executives
• Advisors: 1 Legal & 1 Regulatory Consultant, 1 NGO Partnership Specialist
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12. Appendices
Regulatory & Compliance Checklists:
• RBI and NPCI compliance requirements checklist.
• Data protection and user consent policy drafts.
• KYC for every customer as mandated by RBI to prevent misuse.
Feature Flow Diagrams:
• Visual representation of how the USSD/SMS interaction will work for users.
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13. Conclusion
MicroPay India is a timely, practical solution to India's rural digital divide in financial
services. With offline-first technology, people-first design, and ecosystem collaborations, it
has the potential to redefine access in financial services. Not only does the venture open up
new economic opportunities, but it also promotes financial inclusion, trust, and empowerment
in underserved areas. We call on stakeholders, investors, and partners to join this effort and
co-build an inclusive future for India's rural economy.
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