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India’s Only Cash Back Site, CashKaro is Going Offline

Since starting in mid-2013, CashKaro has done about rupees 40 – 45 crores in cash back to its users in the past 3 years

Photo Credit : techninasia.com,

Rohan and Swati Bhargava are the cofounders of India's first cash back site

But not in the way you think. The cash back company, cashkaro.com, will be tying up with Yes Bank to set up India’s first ever Card Linked Offers (CLO) program. The proposition is sought as an “innovative customer loyalty platform that provides online and offline shoppers with personalized merchant deals on which shoppers can avail cashback offers”.

On why the hitherto 100 percent online startup is now going offline with this CLO program, Rohan Bhargava, cofounder of CashKaro.com said, “the online retail market is just 2 to 5 percent of the entire market. Of course ecommerce is growing rapidly but the much larger market is out here in the brick and mortar space.” Since starting in mid-2013, the CashKaro has done about 40 – 45 crores rupees in cash back to its users in the past 3 years. Rohan continues that the offline retail space will offer them a market that is about 20x than online retail.

Customers can avail cashback offers going up to 25 percent from the currently partnered 20 or so online and offline retailers available on the cash back program like Forever 21, TataCliq, Chaayos, Junkyard Café, UrbanClap, Zivame, Nearbuy, Limeroad, Netmeds, BigBasket, Fortis Healthworld, The Beer Café and FreshMenu amongst others. There will be 100 -150 more retailers added in the coming months.

The program is initially available for Yes Bank debit card holders and then subsequently will be extended to credit cards and other platforms like the Yes Pay wallet.

Ritesh Pai, chief digital officer at Yes Bank said, “We first started with debit card holders since that is our largest user base (1.6 million debit card holders vs around 1 lakh credit card users) and my gut feel is that conservatively we might see card usage increase by 15 to 20 percent in the first quarter this CLO program is introduced. Such cashback offers is a loyalty program smartly built using analytics and algorithms and is the future way to target users better. Here we are creating a wow experience by presenting cash back when they are least expecting it. It’s a seamless way to increase customer loyalty because a user won’t have to learn any new skill plus it’s a merchant funded (not bank funded) method to increase card usage - one of the key revenue generators for any bank.”

“So far there are only two countries that do cash back offers. One is the US where companies like EDO Interactive and Cardlytics have been doing card-linked offers for the past 10 years or so by partnering with around 200- 250 banks. They have been massively popular. The other country is India and CashKaro is definitely the first in India and as far as I know the first in Asia as well to get into card-linked cash back offers.”

Cash back vs Discount

To a customer it may feel like they are winning when they get cash back into their accounts instead of having to pay less for a product because of a discount. But basically it’s the same thing. Rohan said, “Cash back is a kind of discount but it does so without discounting the brand.”

While the value proposition of cash back vs discount is more or less the same for the consumer the biggest value proposition of cash back lies with the marketers or merchants. They save money by giving out cash back offers rather than discounts.

Rohan explained, “If you’re a merchant giving away discounts you will have to spend on both marketing strategies to target customers and on the discount. Cash back offers is a lot more intelligent way to target your consumers. It took us about 6 months to develop the tech backend for this product. For example, we will tell one of our partner merchants, Chaayos, to allocate expenditure for 15 percent worth of cash back offers. Out of that we will give the customer a 10 percent cash back offer and CashKaro will keep 5 percent as the commission. CashKaro will only be earning commission on the customers who purchase Chaayos through CashKaro’s offers, hence it’s a 100 percent performance based marketing solution.”

CashKaro has so far raised 5 million dollars from investors like Kalaari Capital and Mr Ratan Tata. But because the expense for the cash back is with the merchant, they do not spend on cash backs or on any discount-giving like most players in the ecommerce space and will be planning to tie up with more banks in the future. “Yes we have quite a bit of the funds left, most of the capital was dedicate to hiring good talent. Since the space we are in is not very cash intensive we can manage to have a revenue increase of 10x for an investment of 1x. I think we can be profitable within the next two years quite comfortably,” Rohan said.



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