axiTrust CEO Discusses Market View and Guarantee Challenges
Aditya Tulsian, CEO of axiTrust, spoke with CB Insights about the company's market perspective and customer needs, highlighting challenges with traditional business guarantees in India.
In India, securing a promise for contract fulfillment, known as a guarantee, often requires businesses to pledge significant capital. Aditya Tulsian, CEO of axiTrust, explained to CB Insights that traditional bank guarantees necessitate locking up 50-100% of the guarantee amount in cash, fixed deposits, or collateral.
This practice immobilizes a company's own funds, creating a barrier for businesses needing to prove their trustworthiness. Nearly every business-to-business transaction in India, from the bidding stage through project completion and final payment, demands such a guarantee.
For decades, bank guarantees have been the primary method for providing these assurances, but at the cost of substantial financial commitments from suppliers. Tulsian's comments suggest that this long-standing requirement poses a significant challenge to corporate liquidity and operational flexibility.
The interview provided insight into axiTrust's strategy for addressing these market demands and customer needs, aiming to streamline and facilitate B2B transactions by offering alternatives to conventional, capital-intensive guarantee methods.