MINKO: DEVELOPING A NICHE FINTECH LENDING BUSINESS MODEL
CASE STUDY SOLUTION
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SYNOPSIS
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Minko Platforms Pvt. Ltd. (Minko), a niche Goa-based financial technology (fintech) lending startup, faced
a dilemma. The company began as a digital payments business that focussed on helping migrant workers
send money to their distant homes through a network of small retail grocery and telecom stores. The
COVID-19 pandemic deeply impacted this business and as a result the company rebranded and transitioned
to digital lending, specializing in providing supply chain distribution financing to small retailers that
n
sourced inventory from fast-moving consumer goods (FMCG) distributors.
tio
Having successfully tested and established this new business model, the company evaluated its options for
scaling up. Should it continue to focus on distributor-retailer transactions, having gained experience and
lu
penetration in the market, or should it target the higher value stockist-distributor transactions further up in
the supply chain? The latter was more remunerative but had more potential competition from other
So
The Case Solution Starts From page 5
,1. Analyse and detail the business model of a fintech company.
2. Evaluate the macroeconomic challenges faced by fintech businesses, especially in the context of a
developing economy.
3. Formulate strategies for businesses to overcome regulatory and other environmental challenges and to
ensure sustainability.
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ASSIGNMENT QUESTIONS
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1. Discuss the current business model of Minko.
So
2. What are the various macroeconomic challenges that Minko has faced or is facing as a startup? What
can Minko do to strategically manage these challenges?
3. What would be probable advantages and disadvantages of Minko becoming a registered NBFC?
4. Going forward, which segment of customers should Minko target to ensure the sustainability of the
company’s revenue model?
The Case Solution Starts From page 5
,2. What are the various macroeconomic challenges that Minko has faced or is facing as a startup?
What can Minko do to strategically manage these challenges?
New technologies such as artificial intelligence, machine learning, and big data analytics are giving rise to
many new business models that are adding value for their customers by developing either new products or
new ways of delivering these products. As these new business models develop and grow, they often face
multiple macroeconomic challenges that affect various aspects of their business model. If these challenges are
not managed strategically, the results for the startup could be grave. Minko faced several such challenges.
The first macroeconomic challenge that Minko faced was during the COVID-19 pandemic when the
company operated as Minkspay. The company had targeted the niche digital payments market of migrant
labour. Due to a prolonged lockdown in the country and the resultant reverse migration, a large number of
Minkspay’s customers moved back to their home towns and villages. This meant that a major portion of
the company’s customer segment no longer needed to use the platform. The value proposition that the
company offered as Minkspay (a convenient mode of remittance) was no longer required as its customers
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Sa
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tio
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So
The Case Solution Starts From page 5
, EXHIBIT 2: PROS AND CONS OF LEAD GENERATOR BUSINESS MODEL VS. NBFC BUSINESS MODEL
Parameter Lead generator business model NBFC business model
1 Capital Capital requirement would be low, since As an NBFC, Minko would be required
requirement Minko would only pass on leads and not to maintain a minimum amount of
invest capital in lending. In other words, capital for lending. Over and above
the lending would not be on the this, additional capital would be
company’s balance sheets. needed to maintain the required capital
adequacy ratio depending on the
riskiness of their assets.
2 Regulation
e
pl
m
Sa
n
tio
lu
So
The Case Solution Starts From page 5
CASE STUDY SOLUTION
e
pl
m
SYNOPSIS
Sa
Minko Platforms Pvt. Ltd. (Minko), a niche Goa-based financial technology (fintech) lending startup, faced
a dilemma. The company began as a digital payments business that focussed on helping migrant workers
send money to their distant homes through a network of small retail grocery and telecom stores. The
COVID-19 pandemic deeply impacted this business and as a result the company rebranded and transitioned
to digital lending, specializing in providing supply chain distribution financing to small retailers that
n
sourced inventory from fast-moving consumer goods (FMCG) distributors.
tio
Having successfully tested and established this new business model, the company evaluated its options for
scaling up. Should it continue to focus on distributor-retailer transactions, having gained experience and
lu
penetration in the market, or should it target the higher value stockist-distributor transactions further up in
the supply chain? The latter was more remunerative but had more potential competition from other
So
The Case Solution Starts From page 5
,1. Analyse and detail the business model of a fintech company.
2. Evaluate the macroeconomic challenges faced by fintech businesses, especially in the context of a
developing economy.
3. Formulate strategies for businesses to overcome regulatory and other environmental challenges and to
ensure sustainability.
e
pl
m
Sa
n
tio
ASSIGNMENT QUESTIONS
lu
1. Discuss the current business model of Minko.
So
2. What are the various macroeconomic challenges that Minko has faced or is facing as a startup? What
can Minko do to strategically manage these challenges?
3. What would be probable advantages and disadvantages of Minko becoming a registered NBFC?
4. Going forward, which segment of customers should Minko target to ensure the sustainability of the
company’s revenue model?
The Case Solution Starts From page 5
,2. What are the various macroeconomic challenges that Minko has faced or is facing as a startup?
What can Minko do to strategically manage these challenges?
New technologies such as artificial intelligence, machine learning, and big data analytics are giving rise to
many new business models that are adding value for their customers by developing either new products or
new ways of delivering these products. As these new business models develop and grow, they often face
multiple macroeconomic challenges that affect various aspects of their business model. If these challenges are
not managed strategically, the results for the startup could be grave. Minko faced several such challenges.
The first macroeconomic challenge that Minko faced was during the COVID-19 pandemic when the
company operated as Minkspay. The company had targeted the niche digital payments market of migrant
labour. Due to a prolonged lockdown in the country and the resultant reverse migration, a large number of
Minkspay’s customers moved back to their home towns and villages. This meant that a major portion of
the company’s customer segment no longer needed to use the platform. The value proposition that the
company offered as Minkspay (a convenient mode of remittance) was no longer required as its customers
e
pl
m
Sa
n
tio
lu
So
The Case Solution Starts From page 5
, EXHIBIT 2: PROS AND CONS OF LEAD GENERATOR BUSINESS MODEL VS. NBFC BUSINESS MODEL
Parameter Lead generator business model NBFC business model
1 Capital Capital requirement would be low, since As an NBFC, Minko would be required
requirement Minko would only pass on leads and not to maintain a minimum amount of
invest capital in lending. In other words, capital for lending. Over and above
the lending would not be on the this, additional capital would be
company’s balance sheets. needed to maintain the required capital
adequacy ratio depending on the
riskiness of their assets.
2 Regulation
e
pl
m
Sa
n
tio
lu
So
The Case Solution Starts From page 5
