Beijing-based bike rental service Ofo will launch its services in India in a tie-up with Paytm. Reportedly, the Ofo bicycle sharing app will be available on Paytm app along with its standalone mobile app.
The move makes sense as Alibaba is a major investor in both the companies. While Paytm already has a stronghold in the Indian digital payments segment, it will now help Ofo to expand its operations in the country. Ofo raised $700 Mn from Alibaba in July 2017.
Valued at $2 Bn, the unicorn is expected to launch the bike rental services first in Chennai, followed by Ahmedabad, Indore, and Bengaluru. Users can avail bike rental services at a price of $1 per hour.
Ofo is also said to have signed a MoU with Pune Municipal Corporation recently. Under this MoU, it plans to create city-wide bicycle networks.
Inc42 earlier reported Ofo’s plans to launch in India by H1 2018 in October 2017. Boasting a user base spread across 170 cities in China, Singapore, the US, Austria, Thailand, the UK, Russia, Italy, Australia and Kazakhstan, Ofo serves as a “non-docking” platform that allows users to track as well as lock and unlock their bicycles remotely.
Since its inception in 2014, the bike rental startup has secured $1.29 Bn funding in eight rounds from up to 21 investors including Ant Financial, Didi Chuxing, DST Global, Shunwei Capital, Coatue Management, Citic PE, Hony Capital, Matrix Partners China, ZhenFund, GSR Ventures, Will Hunting Capital and Hongdao Capital.
The Indian ecosystem is a lot different from the ‘west’. Thus, it is expected that Ofo will have to face its share of challenges, particularly, the possibility of the bikes being sabotaged by competitors. Still, it is a welcome move and is apparently a need of the hour, considering the different clean-tech initiatives taken by the Indian government and startups.
In the Indian market, Chinese unicorn Ofo will have to compete with a growing class of bike sharing startups, including Vogo Automotive, ONN Bikes, WickedRide, Stoneheadbikes, and Rentabike, Tazzo Technologies and WheelStreet.
Earlier in September 2016, Ahmedabad-based transport company Chartered Speed reportedly entered into a partnership with Germany-based startup Nextbike, in a bid to launch a digital bicycle sharing platform in 100 Indian cities.
Also, in September 2017, InMobi’s co-founder Amit Gupta launched Yulu-an IoT-enabled bike rental platform. Then there’s ZoomCar’s PEDL and LetzCycle and Mobycy too.
After its success in the digital payments domain, Paytm is continuously diversifying its offerings in the Indian market. Recently, the company set up its wealth management division Paytm Money and is all geared up to launch an incubator for Indian startups too.
The Paytm app already offers a slew of services from DTH and mobile payments to booking Delhi Metro Rail tickets and fulfilling daily needs. With the roll out of Ofo bike rental services on Paytm app, what new options get opened up for Paytm in coming times will be worth watching.