Issue dated - 04th October 2004

-

Previous
Issues

CURRENT
ISSUE

INDIA
NEWS

REVIEW
/ GLOBAL

E-BUSINESS

TECHNOLOGY

OPINION

COMPANY WATCH

CASE
STUDY

TECH
SPACE

STOCK

PRODUCTS

COLUMNS

TECH
FORUM

THE
C# COLUMN

BETWEEN
THE BYTES

TECHNOLOGY

SPECIALS
<NEW>

Symantec
Report

Security Headquarters

JobsDB

MINDPRINTS

HMA
BANKBIZ

EC SERVICES

ARCHIVES/SEARCH

IT
APPOINTMENTS
Openings At Jobstreet.com

WRITE
TO US

SUBSCRIBE/RENEW

CUSTOMER
SERVICE

ADVERTISE

ABOUT
US

Network Sites

IT
People

Network
Magazine

Business
Traveller

Exp. Hotelier
& Caterer

Exp. Travel
& Tourism

Exp. Pharma
Pulse

Exp. Healthcare
Mgmt.

Express
Textile

Group Sites

ExpressIndia

Indian Express

Financial
Express

Front
Page > Cover
Story > Story

Print this
Page|  Email
this page

Avenues India: a quiet success
story

This should be
the stuff of fairy tales but it's not. A homegrown player, Avenues
India, has changed the rules of the game with its economical payment
gateway and e-commerce solutions to emerge as the largest player in
the South Asian e-commerce space. Along the way, it has enabled the
small merchant to reach out to the world, says SRIKANTH
RP

ANUPAMA
SALVI believes
that debit cards are and will continue to be the preferred
medium over credit cards, especially in the Asian
region

eBay's
high-profile acquisition of baazee.com was recently in the news.
Away from the headlines, a relatively unknown player, Avenues India,
has emerged as the largest player in the South Asian e-commerce
space. In the span of just three years, the company has gained a
merchant base of over 2,200 customers with close to four websites
going live using its payment gateway every single day. The number of
transactions on its payment gateway is a mammoth 26,000 per month.
The company says that more than 75 percent of Indian merchants who
sell their goods online use its payment gateway for processing their
transactions. This can be seen from its star-studded client list
that includes the likes of the Tata group, the Indian Express group
(publishers of this magazine), LG Electronics, GATI, IL&FS,
Jammu & Kashmir Bank, the Somaiya group, the Mahindra group, the
union ministry of commerce and industry, and the Transport
Corporation of India.

One of the key reasons for the company's
success is its economical payment gateway solution which lets
merchants start e-commerce operations with a solution for as little
as Rs 7,500. This is in stark contrast to the minimum of Rs 3 lakh
that you would have to fork out for a rival payment gateway. Another
strategic move is that of supporting debit cards instead of the
industry norm of supporting only credit card transactions for
Internet commerce. This move is significant as the credit card base
in India is small when compared to that of debit cards. In 2001, the
company was one of the few that realised the potential of enabling
existing Internet bank accounts for online payments to boost
e-commerce. Currently, the company has tie-ups with almost all
Indian banks which offer Internet banking. Avenues' flagship
product, CCAvenue, the payment gateway solution, has been well
accepted by the industry as most companies do not want to invest a
substantial amount in payment gateway solutions. These organisations
want to test the online waters for their product offerings. Avenues
enjoys an advantage over its rivals (say a Citibank or ICICI Bank)
as it is the country's only neutral payment processing solution that
allows transactions to be made using not only all credit card brands
but also all Internet-enabled bank accounts at a fraction of the
cost of current payment gateway solutions. Better yet, merchants
having a tie-up with CCAvenue's solution can receive their payments
in Indian rupees.

Beyond Indian
shores

While the Indian market is showing signs of
huge growth, the global market is much bigger. With a view to offer
a bigger base to its merchants, Avenues has tied up with 20 of the
biggest Chinese and Hong Kong-based banks for direct debit
facilities. This agreement gives merchants using the CCAvenue
payment gateway solution access to more than 376 million Chinese Net
banking users. To further strengthen its presence in the Far East,
the company has entered into agreements with the top three banks in
Singapore-Citibank, DBS and UOB-for direct debit. This tie-up has
been received very well in Singapore, with 350 merchants signing up
in just three months.

Says Anupama
Salvi, the company's chief operating officer, "Everyone does not own
a credit card. We believe that debit cards are and will continue to
be the preferred medium over credit cards, especially in the Asian
region, which is credit card averse. Going forward, our aim is to
build the world's biggest direct debit payment engine." This is in
addition to the support for all credit card brands, thus giving the
customer the option of paying through any medium he wants.

The biggest
market is undoubtedly the country that most players are bullish
about-the US. For tapping this market, the company has entered into
a tie-up with a US-based organisation which will allow American
customers of any bank to issue virtual cheques to merchants using
Avenues' payment gateway. Effectively, this means that a merchant
using Avenues' payment gateway solution can offer payment options to
customers in the biggest economy, the US, and in emerging economies,
India, China and other South Asian countries. If everything goes as
planned, Avenues will have created a large parallel payment
processing mechanism.

Observes Aparna
Gawande, chief technology officer, Avenues, "Managing the scale of
transactions regardless of geographical, legal, cultural, language
and currency barriers will be a major challenge. Our aim will be to
build an alternate form of electronic payment which is
cost-effective and 100 percent fraud proof."

Using the
foundation

APARNA GAWANDE wants to build an
alternate form of electronic payment which is cost-effective
and 100 percent fraud-proof

While the
foundation (payment gateway) is in place, Avenues knows that
exponential growth will not come its way unless it offers products
for industry verticals. Accordingly, the company began its search
for domains that leverage the power of the Internet to boost
e-commerce transactions. The first solution, ResAvenue, a hotel
reservation engine with an in-built payment gateway solution, has
already been snapped up by 100 hotels. Here too the company is
targeting the high-growth tourism sector which can use the Internet
to attract global customers. While many Indian hotels do have
Websites, online interaction is restricted to initial contact
through the site. In the absence of a proper e-commerce solution,
the rest of the transaction is still done through the traditional
model: telephone, e-mail or fax. While there is a clear need, not
many hotels (apart from, say, the Taj group) have the ability to
complete a transaction online. Here too, the sensible pricing; a
hotel can start with a solution that costs as less as Rs 10,000,
along with powerful features such as an in-built CRM module-has made
Avenues' product successful.

The company's
next offering, CineAvenue, is scheduled to be launched next month.
With an online ticketing and payment engine, CineAvenue is aimed at
cinema houses, multiplexes and entertainment venues. Customers can
see the seats they are buying on the Net, with support for
mobile-based payments. Next in the line is EventAvenue, which will
provide an event organiser with all the tools he needs to manage an
event. From putting up the layout of the space for sale, to selling
space to exhibitors, to managing the invitee list and issuing
tickets, the product covers all the aspects of hosting an event. All
the products have support for transactions in several currencies (US
$, the Euro, Singapore $ and the Indian Rupee).

Avenues India
has a two-part strategy. The first, using the payment gateway, has
already been executed. The second is the challenge of enabling more
customers to buy on the Net by developing specialised products to
boost e-commerce. From the way the company has been growing, this
strategy is paying off. From a mere six customers in 2001, Avenues
has more than 2,200 today, and its turnover has zoomed from Rs 2
crore to Rs 70 crore.

The success of
Avenues can be explained simply—create an opportunity by offering a
technologically good product at an affordable price to Indian
organisations. While Avenues indeed has big names on its client
list, the success of the company in encouraging even small merchants
to look at the power of the Internet is the real e-commerce
revolution taking place in the country.

Partial
customer list

Jammu & Kashmir Bank

LG Electronics

Modicare

IL&FS

Press Trust of India

GATI

Mahindra & Mahindra

Somaiya group

Imax Adlabs Multiplex

Transport Corporation of India

Indian Express group

Tata group

oxfordbookstore.com

indiainfo.com

C-DAC

<Back to
top>

© Copyright 2003: Indian Express Group (Mumbai, India). All
rights reserved throughout the world. This entire site is compiled
in
Mumbai by The Business Publications Division of the Indian Express
Group of Newspapers.
Please contact our Webmaster for any
queries on this site.