OPNFI pioneers embedded finance in Southeast Asia

Exclusive interview with OPNFI co-founders Amit Sharma and Kaustuv Ghosh sheds light on their innovative approach to financial inclusion.

The surge of FinTech startups integrating financial services into non-financial platforms has been a notable global trend, even in Singapore, and OPNFI is at the forefront of this transformative landscape.

In an exclusive interview with Singapore Business Review, Amit Sharma and Kaustuv Ghosh, co-founders of OPNFI, shared the driving force behind launching their platform and the impact of embedded finance on businesses in Southeast Asia and the global south.

Embedded finance refers to the integration of financial services into non-financial platforms, creating seamless and optimised use cases for different users, including consumers, governments, and businesses.

OPNFI is a next-gen Embedded Finance (EmFi) platform for the global south communities including small and medium businesses and Amit is focused on growing the OPNFI business in Southeast Asia.

Sharma, who is OPNFI’s managing partner, said it was conceived with the primary objective of addressing the prevalent financial inclusion issues in Southeast Asia and other regions.

“We began by providing a network built on the automated clearing house infrastructure in the Philippines,” said Ghosh, “and expanded to offer direct bank payment services to various operators, financial institutions, businesses, merchants, and government establishments.”

This was followed by the establishment of a direct bank payment service. As Ghosh pointed out, this has paved the way for the evolution of embedded finance, where various payment use cases intersect to provide optimised financial solutions to end-users, be it businesses, governments, or consumers.

He emphasised that the contexts of interaction, often originating from non-financial activities like gaming or reading, offer opportunities to provide tailored financial services through embedded finance.

As OPNFI expands its footprint, the creation of an embedded finance network for the global south is set to redefine financial services accessibility.

“When you start offering new rails and payment infrastructure, the key is to maximise optimisation and yield for the end user — whether it's the best interest rates for consumers, lowest revenue collection costs for governments, or optimal payment acceptance and credit options for businesses,” said Ghosh.

The strategic partnership between OPNFI and Actyv.ai has furthered OPNFI’s mission of providing financial solutions to SMEs in the Global South. Ghosh explained the partnership's impact saying: “We’ve worked closely with Activy.ai to create a comprehensive credit score that considers GST returns, financial health, invoices, and payments. This enables SMEs to access the right financial products seamlessly and efficiently.”

One of OPNFI’s distinguishing features is its commitment to open API enabled architectures. “Our completely cloud-native and open API structure has been a game-changer,” said Ghosh. “It offers ease of connectivity, reduces transaction costs, and facilitates greater financial inclusion for our partners and customers.”

In the quest for success in the embedded finance landscape, Sharma highlighted several key qualities that players should possess. “Speed, cost optimisation, and personalisation are paramount… Being ‘always on’ is crucial in today’s world, where businesses expect services to be available 24/7 like a utility,” he stressed.

Ghosh added that understanding the unique customer journey of businesses is essential. “We tailor financial products to seamlessly embed within their customer experience. It's crucial for us to grasp the diverse needs and context in which financial services are required,” he said.

The co-founders' insights have far-reaching implications for businesses in the Global South, as they open up new opportunities for financial growth and expansion.

Sharma affirmed: “With the right partners and an open API architecture, businesses can unlock greater value for their customers and drive financial inclusion to the next level.”

The future of embedded finance in the Global South looks promising, with OPNFI leading the charge in promoting financial inclusion and optimised services for consumers, businesses, and governments.

OPNFI’s pioneering approach to embedded finance is set to revolutionise financial inclusion in Southeast Asia well into the future.

As Sharma and Ghosh articulated, the road to success in embedded finance lies in providing efficient, cost-effective, and secure financial solutions to meet the diverse needs of businesses and individuals.