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Trimax targets inclusive IT advances

Interview - February 5, 2016

Trimax is proving to be the ideal IT resource partner in India, including for major global companies such as Facebook and Microsoft. Surya Prakash Madrecha, Chairman and MD of Trimax, explains how its electronic payment applications and training in the transportation sector in particular – as well as its partnerships in the telecom, banking, government, healthcare, retail and education sectors – are set for exponential growth as it continues to bring rural communities online.



Could you please give an overview of Trimax and how the company has developed into India’s most prominent IT solutions provider?

We started Trimax in 1996 and will be completing 20 years in 2016. Before that, in 1991, I joined an IT company here in Mumbai and worked there until 1996. I then became the CEO of that company and in 1996 we started Trimax with zero capital. Up until 2001, we were just a small company with about 100 people. However, from day one we were breaking even in revenues. At that time, we were doing computer servicing – assembling, servicing, maintenance. We were basically doing what Dell used to do – assembling, supplying and servicing computer appliances.

Then in 2001, a lot of US companies started coming to India. There were international call centers, medical transcription companies, BPOs, and KPOs outsourcing to India. That was a time when our domestic business turned international and foreign customers started to put up their outsourcing centers here looking for partners. We did an IT setup for many of them. We did IT services 24/7, SL-based delivery. That is how we learnt how we work 24/7 in the US and India, about the meaning of a global delivery model, and how to outsource. You could say that 2001-2002 was next-level learning for Trimax.

From then onwards, we went to some of the companies in the government and transportation sector. And in 2005, we got an entry into the transport industry where we did a ticketing reservation system for road transport corporations. These are the transport corporations we work with currently. We do the ticketing and reservation system for them. At Trimax we have developed ‘Indianized’ products. This is a handheld machine out of which the ticket is produced. In the bus, there is a conductor, which gives the ticket to the customers. We do 20 million transactions on a daily basis. We do this in Mumbai, Maharashtra, Thane, West Bengal, Bangalore, Rajasthan, and Uttar Pradesh.

We are looking to raise the number to 50 million passengers in a few years’ time. In some states, we have a sort of monopoly in the business, where we are the single largest player in the industry. We also train conductors, especially for people who don’t know English and are not graduates. It is a five-year project. We take transaction-based revenue and charge every transaction. We do not supply anything to road transport corporations.


How does the revenue model of the company work?

Our revenue model is based on the number of passengers traveling daily and we charge about .1 cent, .2 cent or .5 cent per passenger. We do it for five years after initially having implemented the project for nine months. The cost of one bus ticket would be anything between $.1 and $.5. Average ticket price would come to $1.


What type of services does Trimax offer today?

Apart from automatic fare collection, we do vehicle tracking, fuel management, and smart cards. We do it currently only for buses, specifically for government road transport corporations. We specialize in this as we see that no one is willing to serve in C and D class cities. Everyone wants to work in the top 10 cities. We go to rural areas as these road transport corporations cover the entire state. In Maharashtra, we run the technology for the entire state, not just for Mumbai or Pune.

We have specialized in an intelligent transport system. We are providing the technology for everything related to transport. At the back-end, our software is there. We provide ticketing software, a public information system, and are coming up with a passenger counting system. We are helping the road transport corporations because they are not up to the mark as yet. Therefore we are building efficiency in their working process. These are the different types of software that we have built – electronic ticketing machines, smart card, GPS, overhead system, PIS system, fuel management, planning and scheduling of buses, and CCTV cameras.


How would you describe your relationship with the government?

We have been working with the Maharashtra government for seven years now and it is a long-term relationship of deep trust. We build the whole infrastructure on the outcome-based model. We invest upfront in the capital for the government and then the government does the transaction-based revenue for us. We don’t supply anything for money. We give them a service, invest in it and then charge based on outcomes. People sometimes are scared of the government and we too get worried sometimes, because if the government commits on a contract for five years, they have to stick to that. You cannot have a private contract. But the government is more transparent.


What presence have you gained in India?

We have currently 4,000 people on board. 2,200 are on our own payroll and others are on an outsourcing model. We have a presence in 440 cities in India, where our engineers are present. So we are planning to build our strength from four to two hours in any part of the country. We have 20 million consumers in the transport segment, a network of 30,000 bank branches, and a physical presence of 3,000 people in 400 locations in India.


Is transportation the only sector that you are active in?

We are looking at the ticketing for road transport corporations. The other business is the connectivity with telecom players. If a bank has 1,000 branches, we manage the whole 1,000 branch networks of the bank. This is called managed network services. We are also working with Bharat Broadband Network Limited, where 250,000 village panchayats have got fiber optics. We are doing the connectivity along with BSNL. A panchayat is a place where the population is less than 5,000. We will be working with every rural area in the state. The government is planning to reach these areas through Digital India. Broadband penetration is going to be here. We are connecting the broadband and adding it up with VAS and WiFi. We are doing this in collaboration with Facebook.


What are the main challenges you encounter while going into the heart of the country?

There are two challenges. One is technology and the second is training. The people who are getting connected are not well versed with technology. Training is a very critical part and essential in order to be able to execute the project and run it for five years. 33% is technology, 33% is training and the rest is proper documentation that you submit to the government to receive the payment.


In a way, is your training and education related to the Skill India program?

Yes it is. We faced the challenge in training conductors who are 50 years old and who keep saying that they don’t want to learn the technology, that they don’t want to carry a machine. We have trained people from 25-30 years first, and then the age group 30-35 and 40-45. Then they realized the ease of IT and started using it. Today the situation is that if the machine doesn’t work, they won’t take the bus. This is the type of change we have been able to accomplish in five years. Adoption of technology is about training the people, empowering them and giving them the advantage. This requires patience. Acceptance of the technology has been an enormous challenge for Trimax. But Trimax has catered to this challenge. Handing over technology to a person, who had initially no idea about how to use it, has been a big challenge that we have resolved.


What other partnerships other than the government do you have?

We have a tripartite with BSNL and CISCO, a US company. We work closely with CISCO and use their equipment. BSNL is a government telecom company and the largest one in the country and Trimax does the services in 440 cities. We provide the apex model to customers. Currently we are managing 40,000 customers at different branches. Then we have two data centers, one in Mumbai and another in Bangalore where 300 rakes keep the customer data, storage and security of the data. Large banking companies are our customers. In the road industry, we are also implementing this solution. This is actually what is driving the growth of India. We have currently 20 million customers in transport. The government is trying to connect 200 million users by broadband by 2020. There is a plan to set up 100 Smart Cities with IoT technology, which will bring up lot of internet and make the consumer smart.

Digital India will bring broadband to every village to enable tele-services, tele-education, tele-healthcare and utility of services to reach there. The micro-payment industry, like the mobile wallet, is coming up. E-payment is a big industry, and at Trimax we would like to serve it. As broadband penetration is increasing, so is the payment industry. Data on the internet is estimated to grow twentyfold in the next five years.

We have also just launched a partnership with BSNL for WiFi where they will put the fiber in the village and we will make the whole village Wi-Fi connected and give value-added services on top of that. We are again working in the rural areas in north India. We also work in cloud analytics, mobility, and the domain space. Once they do the WiFi, we provide the services to the consumer. This is what we are currently doing by being in the urban, semi-urban and rural sectors, and the verticals we work with are telecom, transport, banking, government, healthcare, retail and education. We will be offering more to them through B2C and VAS. We are also launching ticketing solutions on the mobile app. All these applications are being converted to mobile and the app will run it on the mobile.


Are you the only company in India doing this?

In transport and telecom, we are a domestic company. The e-commerce industry is growing with online bus ticketing and reservation systems in the private and government transport segments. This is a big market under which we operate. Bus booking is a service we are trying to develop, enabling a passenger to book the ticket online and travel without any hassle on the bus.

Through mobility and payment solutions we get customers from transport or telecom and develop multiple utility services out of this relationship. In other words the customer can use payment solutions, government services, utility services, insurance, health care services, etc. A customer can use all these services from the internet.


Do you also have a franchisee model in place?

We have a franchisee model in place where the franchisee uses this machine. In rural places, people still don’t use smart phones. A rural franchisee or partner takes over all the transaction. The machine is a prepaid model here. Suppose he’s got $1000 in the machine every day as recharge, he can do multiple transactions with that and that reflects in our servers here. So we are putting up thousands of franchisees to do these transactions.

The customer can use a smart card and wallet as mobile payment on the bus, at the petrol pump, to pay the electricity bill, phone bill, and do online purchases. So what initially has started with a transport customer has become a multi-platform – and all with a single card. This is a part of Smart City that will be brought in. A customer doesn’t want different wallets and cards. Like Octopus in Hong Kong, there is a common transport system. Every day a customer uses the bus twice for going to and coming from work. He would prefer to use the same card in multiple places. It is also reliable as it is a government card. We are rolling out our services in Maharashtra, Delhi, Rajasthan, Uttar Pradesh, Bangalore and Kolkata. Once there is WiFi, the customer can do banking, healthcare, education, government tasks, security services and retail. So it will become a Smart Village. With 5,000 villages getting connected, many people will reap the benefits. We are looking at a market of 10 to 20 million people.


Right now, for people who don’t have smartphones, you are using one person who is doing it for them?

Yes. Slowly, we are putting up on sale $40-$50 smartphone to enable them to get the services. We are educating them also. The technology adoption will happen later.


You have been partnering with many international companies, such as Microsoft. Do you have presence in America?

Yes. We have a partner there, Microsoft, where we do the implementation for Microsoft customers. MS gets the global customers and we remotely implement the technology from Hyderabad. We are getting knowledge from them. Microsoft has become our knowledge partner in India while we have become a local arm in the US. Together we deliver our services. There is enough space for everyone, right from execution to delivery. They have good capital access also. Today the interest rate in India is around 10%, and there it is 2-3%, giving them the advantage. For them it is profitable and we can use this as a market to start with. We have a huge presence in India. If there were 10 IoT companies we identify in smart cities, rural agriculture, or developed some product, we would enable Microsoft to get into the market. That becomes a win-win situation for both the partners. They don’t have to go looking for new markets, something that would take them another 10 to 15 years. Even for Facebook-like companies, knowledge of the local products is required. Technology, IP and execution to support the grass-roots level people are equally important. We are the connecting point between knowledge, manufacturing, agriculture industries and the local people to enable them to work it out. We do the last-mile connectivity to the common man.


Where would like Trimax to be in 10 years’ time?

We would like to go to the people, convert 5,000 villages into 50,000 and serve the people so that they don’t migrate from rural areas to the cities. If we can create a market for them there at the village level, they would not have to travel there. They can make their own ecosystem utilizing the advantages that are there and live happily. Once you connect the IT in rural areas, you can build some IT products for that particular market as an emerging market product, not a developed market one. The requirement is for rural and semi-urban areas and we will work on a solution towards that.


With several Indian-Americans at the helm of major US tech companies, do you see a shift in the way the diaspora is engaging with their home country?

Definitely they have started to explore opportunities, but many are still in a wait-and-watch mode. In other words, they will do some pilot project, but there is no decision on investing millions of dollars in India yet. They have started looking at some used cases, proof of concepts (POCs). For any business to put money, there has to be a viable return.


Given the theme of the “Fourth Industrial Revolution” at Davos this year, how can technology be deployed in such ways that it leads to inclusive growth rather than exacerbate income inequality and unemployment?

I think what everyone should see about IT is it is not just about getting a job in the industry. It is about how you can improve productivity. If it is perceived in that way, it will benefit the people. This does not mean that jobs have to be taken away from people. People can use IT to do the work in a better way and transform the business.

Our job as a CEO is to look at how to do this transformation and take it to the next level. It is all about dealing with the continuous change in people’s live and in society as a whole, to use knowledge and productivity in order to grow. So people and processes have to be developed continuously along with the change in knowledge. It is important to anticipate global trends and to use technology for the betterment of the people. The US is very good in this regard. Every three-four years they come with some new product and surprise everyone.


The only country that can match the US in terms of tech drive is India, wouldn’t you agree?

Basically there is a lot of investment going on in research and development. What happens in the US is also happening in India. At Trimax, we are also spending a lot on R&D. We are investing a lot of time and money in developing IoT products. If the base is strong, the rest will automatically follow.


How would Trimax like to be perceived in the US market?

Definitely I would like to be seen as a useful resource partner for US companies to develop products together. Trimax is helping to develop Digital India.