Nikhil and Nithin Kamath reveal what's next for Zerodha: 'We really want to be a bank, but...'

Zerodha co-founders Nithin and Nikhil Kamath are pushing for significant changes at their company, aiming to become a bank. Speaking alongside Chief Technology Officer Kailash Nadh at Zerodha’s Bangalore office, the Kamaths discussed the challenges they face, especially in securing a banking licence.

Nikhil Kamath expressed frustration over their ongoing efforts to get the licence, saying it is essential for Zerodha’s growth. “We really want to be a bank, but after trying for years, we have not been allowed to,” he said in a podcast with CNBC-TV18.

The founders emphasised the importance of diversification for Zerodha’s future, envisioning the company as a one-stop financial institution, offering more than just brokerage services. Nikhil also addressed concerns within India’s startup ecosystem, stressing the need for better collaboration between entrepreneurs, regulators, and the government.

He warned against the dangers of excessive regulation, comparing it to a strict classroom where creativity is stifled. Nithin Kamath echoed these concerns, pointing out that new regulations from the Securities and Exchange Board of India (SEBI) could slow Zerodha’s revenue growth.

Despite these challenges, the founders remain optimistic about India’s startup future. Nikhil Kamath urged a shift in mindset, advocating for an “ally mentality” between entrepreneurs and regulators to reduce fear and encourage more people to pursue entrepreneurship.

Kailash Nadh, however, warned against easing regulations too much, especially in the financial sector, advocating for accountability and compliance to protect investors’ money.