In April, MobiKwik raised $25 m via Series B funding from investors including Tree Line Asia, Cisco Investment, Sequoia Capital and American Express. The firm is in talks with investors to raise $50-100 m
By Hita Gupta
MobiKwik, which operates in the mobile wallets space, plans to add more offline merchants to its portfolio. Currently, the company harbours over 10,000 offline stores and Bipin Preet Singh, founder and CEO, says it aims to bring 1,00,000 stores under its umbrella by March 2016.
“We will start with the organised sector first and then move to neighbourhood shopkeepers who will just need a smartphone to accept payments electronically,” Singh said. MobiKwik’s largest competitor Paytm has also announced plans to operate offline.
In April, MobiKwik raised $25 million via Series B funding from investors including Tree Line Asia, Cisco Investment, American Express and Sequoia Capital. The firm is currently in talks with investors to raise $50-100 million.
The m-commerce company’s chief source of revenue continues to be commissions earned from merchants of anywhere between 3-4% of the value of transactions earned by the merchant. In addition, it also earns some interest on the core float of about Rs 100 crore negotiating the interest rate with the Reserve Bank of India, Singh said. “On an average, a user adds about Rs 400-500 to his wallet and spends around Rs 100-120,” he added.
While the promoters of the company are unwilling to disclose numbers, MobiKwik claims it has grown six times annually since 2012 and broke even at the end of 2013. Currently the company does not generate net profits, but expects to do so by FY 2017. Going forward, it will add advertising as a revenue stream.
“We have more than a million users daily and we want to connect them to the right merchant. We will charge the merchant for the customer acquisition,” said Singh.
Another venture on cards is financial services. Singh said the firm has access to a pool of data on users that will enable it to offer services which are relevant to the user. “In future, we could offer loans and credit cards to the consumer,” Singh explained.
The wallet company had entered the market as a recharge and bill payment platform in 2009 and expanded to other businesses such as travel, entertainment, food and e-commerce. Currently, offline merchants of MobiKwik include Big Bazaar, WHSmith India, Cafe Coffee Day, Sagar Ratna, Archies, Mobiliti World and StoreKing, among others. Singh said that he seeks to increase the number of merchants on the platform from 50,000 to 200,000 by March 2016 and offline is expected to constitute the larger portion.