Mutual funds remain the most attractive investment tool for retail investors and a lot of innovation is happening in this area, said Groww co-founder and CEO Lalit Keshre at the NDTV World Summit on Tuesday. Mr Keshre, who started Groww in 2016 with three other co-founders, spoke about the tremendous rise in retail investing in India and what led to this significant increase in investors’ trust, during a fireside chat on Day 2 of the summit.
Growth in equity investments
Mr Keshre credited internet connectivity, and the introduction of Aadhaar and UPI for lowering the barriers to accessing the investment platforms, followed by platforms that made it easy and transparent.
“Earlier, investing was limited to cities like Mumbai and Bangalore, some cities of Gujarat. Now a lot of customers are from smaller cities because a lot of information that was missing is now available to everybody at their fingertips. That’s a big fundamental change that has happened. The long-term trend started in 2015-16 and we were lucky to start at the same time,” he said.
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Homecoming
Groww was started in 2016 and recently moved its headquarters to India from the US. On whether this will increase its tax liabilities, Mr Keshre said, “That’s a price you pay. But in the long term, I think it would be very good for us.”
“Groww is an Indian company. Customers and management are in India and all operations are in India. So, it did not make sense to be outside India. We are a YC company, so we had to register in the US but now there is no there is no reason why we shouldn’t be in India,” he said. A “YC company” refers to a firm that has been through the Y-Combinator startup accelerator program.
IPO soon?
Mr Keshre did not divulge if Groww is planning to go public anytime soon. Asked when the discount broker could be offering its IPO, he said, “Maybe in some time. It’s somewhere down the line, but we don’t know when.”
Next phase of growth
Mr Keshre said it’s hard to predict what will be the next big phase of growth and that mutual funds remain the most beautiful product for retail investors. “A lot of innovation is going to happen there as well,” he added.
Retail investors and F&O
Asked about regulatory concerns and if he thinks retail investors need to be protected from derivatives trading, he said, “There are certain things where customer protection is very important. From that perspective, I think we are in the right direction.”
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Next big innovation
Asked if Groww is working on its next big innovation, he said the company functions more like an innovation factory than focusing on one big idea. “It’s very boring under the hood, but what comes out is much more exciting for the customers,” he added.
What fintech world needs
Mr Keshre said the fintech industry needs a lot of investment for infrastructure development as it is very complicated. “We’ve almost 400 engineers working on just kind of getting things perfect because it’s about customers’ hard-earned money. Reliability becomes the number one promise in the roadmap and rest everything is secondary,” he said.
