Tata Neu set to take on Zerodha, Groww with stock brokering services

Diversifying its fintech offerings, Tata Group’s super app Tata Neu is likely to soon offer stock trading services Zerodha, Upstox, and Groww, according to two Entrackr sources.

Tata Fintech, which appears to be the backend entity for the securities trading service, has also sought approval from India’s securities and exchange regulator (SEBI). The entity applied for a securities trading license in the last week of June and currently shows an “in process” status.

Tata Fintech is a financial entity established by Tata Digital in November 2021 and is tasked with developing a digital financial services platform. Its board consists of CureFit co-founder Mukesh Bansal, former i-banker Ankur Verma and Tata Digital’s managing director of financial services Modan Saha.

Tata Digital invested $75 million in fitness startup Curefit in June 2021 and appointed Bansal as the company’s president.

As the pandemic raged in 2020 and 2021, many people with disposable income and limited investment opportunities turned to platforms like Zerodha, Upstox, IndMoney, Groww, Smallcase, et al to make and manage their investments. This change gave these companies a huge boost in growth. Of course, the first target for Tata Neu will be the existing users who are already using the Neu app.

Interestingly, Upstox is backed by Ratan Tata, who has backed more than a dozen startups such as Snapdeal, Urban Company, Lenskart, and CashKaro among others.

Launched in April to much fanfare, Tata Neu provides grocery (via BigBasket), luxury goods, travel, health diagnostics, and drug delivery (via Tata 1mg). It is worth noting that the app already offers financial offers like UPI, bill payments, loans, and insurance.

The addition of the stock broking service will make Tata Neu a more attractive proposition for users. According to Sensor Tower data, this super app has been downloaded almost 16 million times from the Google Play Store.

However, challenges remain. Tata Neu failed to impress users due to several reasons such as poor user experience which includes longer loading times and a lack of a unified cart (order page) among others. The super app’s chief technology officer (CTO) Sauvik Banerjee quit in July after six years with the group.

An online brokerage that demands a higher level of delivery in terms of availability, predictability, quality of research, and more can prove to be a massive disruptor with its demands if the application is already struggling to keep up. A drop in satisfaction numbers can never be good for the perception of a group built around its technology firms like TCS and others. And the competition here may surprise the Tatas, with a mix of institutional, start-up, and well-funded brokerage apps all vying for a super-competitive market.

sources