Nithin Kamath of Zerodha on Saturday took to X, formerly known as Twitter, to explain how eKYC, digital signatures, and digital documentation have played a significant role in low-cost brokerage’s growth. These technologies have made it easier and faster for customers to open accounts and access financial services, he said.
For the unversed, eKYC is a process that allows businesses to verify the identity of their customers electronically, without the need for physical documents. This has made it easier for customers to open accounts and access financial services, especially from remote locations.
Digital signatures are a type of electronic signature that can be used to sign documents electronically. This has eliminated the need for customers to print, sign, and courier physical documents.
Kamath said in a post that the company had acquired their first 60,000 customers after 6 laborious years, a process involving complex paperwork and long waiting periods. Within the following six years, the company attained a staggering 1 crore customers, all without a single piece of paper. This superlative growth was achieved through the strategic implementation of eKYC, eSign, and Digilocker, he said.
“It took us 6 years to get to our first 60k customers, each of whom had to sign and courier 40+ pages of forms and wait for days. We got to 1 crore customers in the next 6, entirely eliminating paper in the process. This was enabled by eKYC, digital signatures (eSign), & digital documents (Digilocker),” wrote Nithin Kamath.
Nithin Kamath has noted that businesses and consumers have benefited exponentially due to enhanced productivity, substantial savings, and wastage mitigation due to technology. “Hundreds of millions of pages that didn’t have to be printed and transported and valuable customer time that didn’t have to be wasted. Most of our time in the first six years was spent figuring out how to send forms back and forth collecting docs,” Kamath added.
Today, the company can boast of supporting over 1.3 crore customers with a modest team of just around 1,100. This remarkable feat was achieved with the rapid digital transformation and doing away with the physical process, which has significantly eased our operations, shared Kamath.
“We had ~900 on the team in late 2017 with ~5lk customers. Today, we have 1.3 crore customers with ~1100 on the team. And this while our customer support quality has improved significantly. We have done many other things right, but doing away with the physical process has helped exponentially,” Kamath wrote on X.
He highlighted the fact that this has drastically reduced customer onboarding risk significantly. Physical forms, docs, and signatures with multiple intermediaries vs. the customer directly with their digital identity and signature + mandatory online In person verification (IPV).
Kamath thanked Nandan Nilekani, Pramod Varma and everyone else in the “government and its machinery” for making Aadhaar part of “the robust Indian digital infrastructure”.
Zerodha’s growth was fueled by post-Covid surge in stock markets when the retail participation increased manifold.
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