Businessmodel of Bankbazaar

 Customer Segments

BankBazaar’s products are aimed at the general consumer market. According to its own information it serves more than 50,000 individual customers across 1,300 of India’s cities and towns, with India accounting for more than 96% of the Company’s web traffic. A reported 27% of BankBazaar’s total applications come from non-metro cities, predominantly via mobiles. The Company recently established a subsidiary in Singapore, through which it will begin serving international markets. The Company operates separate web pages for customers in Singapore, Malaysia, the Philippines, the UAE and Mexico.

In addition to its consumer services, BankBazaar is also reported to serve banking clients by maintaining white-label websites through which third-parties provide personal finance products. Among its banking customers are several of India’s most established banks, including HDFC Bank, Axis Bank, and ICICI Bank, as well as personal finance specialist Magma Fincorp.

Value Propositions

The BankBazaar platform allows consumers to browse and compare personal finance products from a range of providers, enabling them to more easily find the right product for their individual needs. The platform makes the process of purchasing finance products simpler and more accessible, with customers also able to apply for loans and insurance products directly through BankBazaar website and mobile app. BankBazaar’s platform often provides cheaper rates than would be available elsewhere and does not charge fees to its customers. For its banking partners, selling via BankBazaar is a cheaper alternative to traditional sales methods, with minimal overheads compared to in-store sales and lower processing fees than other sales channels.

Channels

The BankBazaar marketplace can be accessed via mobile and desktop browsers at www.bankbazaar.com. The Company also offers iOS and Android mobile apps, through which customers can access the online marketplace and receive news updates, give ratings and reviews, and receive support.

Customer Relationships

BankBazaar is a self-service marketplace, with users able to browse and apply for personal finance products directly via the BankBazaar website and mobile application. This process requires customers to enter personal information into the site in order to receive a customised quote. After receiving a quote, consumers can purchase products directly with no interaction with BankBazaar or third-party representatives.

BankBazaar provides a range of support resources to its customers and hosts a community forum where customers can discuss queries and concerns, post reviews and ratings, and provide feedback directly to the Company. BankBazaar also provides service updates and interacts directly with customers via its blog and social media accounts, including with Facebook, Twitter, LinkedIn and Instagram.

Key Activities

BankBazaar operates and maintains an online marketplace that allows consumers to browse and apply for third-party personal finance products, including personal loans, home loans, car loans, and credit cards, as well as health, car and life insurance products. The Company also lists a range of investment and savings products on its website.

The BankBazaar platform provides customers with instant customised quotes, free of charge. BankBazaar is also reported to provide operate and maintain white-label personal finance solutions websites on behalf of banking customers. However, it is unclear whether this remains a significant aspect of the Company’s activities.

Key Partners

BankBazaar’s key partners are banking institutions, personal finance providers and lenders across India. The Company’s first partner bank was ING Vysya Bank, which was shortly joined by ICICI Bank, HDFC Bank, Standard Chartered, Axis Bank and mortgage finance provider HDFC Ltd. The Company states on its website that it now has more than 35 partners across the country, including SBI, India’s largest bank, IndusInd Bank and CitiBank.

The Company most recently added banking partner to its network this month in the form of YES Bank. In addition to traditional banking partners, BankBazaar also agreed tie-ups with insurance providers in India such as Bajaj Alliance, Aegon Religare, L&T, Bharti Axa, Appollo Munich and Iffco Tokio.

Key Resources

BankBazaar’s key resources are its online platform, its IT infrastructure – including servers and data centres – its network of banking and insurance partners, and its personnel. BankBazaar Chief Executive Officer Adhil Shetty has stated in interviews that much of the Company’s spending is focused on employing financial and technology experts.

Cost Structure

BankBazaar incurs costs primarily in relation to the development and maintenance of its online marketplace, maintenance of its IT infrastructure, retention of its personnel, and advertising and marketing. The Company has more than 800 employees, all of whom represent costs in the form of salaries and benefits, and operates offices across Chennai, Mumbai, Bangalore, Gurgaon and Singapore, which accrue fixed cost in the form of rent and utilities.

Revenue Streams

BankBazaar is reported to generate approximately $90 million in annual revenue. It operates under a commission-based business model, primarily generating revenue through commissions paid by its lending partners on every product sale. The Company’s home and personal loan products are reported to be its largest revenue generators. BankBazaar does not charge fees to its customers and does not monetise customer information, which is a common revenue stream for online financial intermediaries.

BankBazaar has also been reported to generate revenue through the maintenance of white-label websites for banking clients, operating a platform under the customer’s branding for the online sale of personal finance products. It is unclear whether this remains a significant revenue stream, considering the expansion of the Company’s core business operations.