Flipkart’s digital payments arm, PhonePe, is expanding its fintech platform by adding financial services for the Millennial generation.
Inc42 had reported in December that PhonePe has launched its own wealth management unit, PhonePe Wealth Services, with an initial authorised capital of $7.12 Mn (INR 50 Cr) and paid up capital of $2.85 Mn (INR 20 Cr).
Terence Onie Lucien, PhonePe mutual funds head, and Aniruddha Shashkant Patwardhan, the chief of the engineering vertical at Flipkart financial services, were going to be the directors of the new wealth management platform.
According to the documents accessed by Inc42, PhonePe Wealth Services will act as an agent, advisor, and consultant to financial services such as deposits, mutual funds, government securities, and ad debentures, among others.
PhonePe cofounder and CEO Sameer Nigam has brought clarity to the company’s plans in wealth management. He reportedly said that PhonePe aims to tap the growing base of Millennials looking to manage their wealth.
Related Article: Flipkart’s PhonePe Steps Into Wealth Management Space
He said while PhonePe’s regulated businesses including its Unified Payments Interface (UPI)-based transactions and mobile wallet would be under one entity and the new, unregulated businesses would be clubbed under separate entities.
The financial services business will involve partnerships with existing players rather than doing a lot of the work in-house.
PhonePe claims to have over 150 Mn users and provides them with its “super-app”, which integrates 25 large digital apps including Goibibo and OYO. Nigam said the company has introduced India’s leading travel apps on its super-app, and food and other verticals will see similar additions.
PhonePe plans to integrate about 50 major apps on its super-app and eventually open it to all digital businesses so that customers can buy almost any service through the super-app.
Flipkart has committed $500 Mn to PhonePe, and the latter has reportedly exhausted about 50% of the amount. It is spending on advertising and promotions to build its offline payments market.
PhonePe is following on the lines of digital payment company Paytm, which last year launched its investment and wealth management arm, Paytm Money. Paytm Money started operations in September 2018 and claims to have a registered user base of 850K.
Also, in October 2018, MobiKwik forayed into the wealth management space after acquiring Mumbai-based wealth management platform Clearfunds. Other notable startups in this space are Fisdom, a personal wealth management startup; Tauro Wealth, a stock market investments platform; Tipbazaar; Scripbox, and ETMONEY, among others.
According to a 2018 IBEF report, the Indian mutual funds industry has recorded a high growth in assets under management (AUM). The total AUM of the industry was recorded at $375.9 Bn (INR 2.52 Tn) between April to August 2018.
[The development was reported by ET.]