In its push towards becoming a financial services platform, mobile wallet player MobiKwik on Wednesday announced the launch of digital insurance on its app.
The platform has started with providing accidental insurance and will be adding a range of life insurance and general insurance products in partnership with insurance companies. Users can buy the products over the app or the website.
“We aim to cater to over 150 million mass and emerging affluent customers through our product range,” said Upasana Taku, director of MobiKwik in a statement. She added, “The insurance penetration in India is close to three per cent of gross domestic product and there is a huge potential ready to be tapped, more so with the exponential increase in the adoption of smartphones and penetration of the internet.
“This presents a vast opportunity for digital insurance to the mass market which has been ignored by banks, distributors and even online companies in web comparison owing to either high distribution cost or low penetration of computers in the country,” she said.
MobiKwik plans to sell 1.5 million insurance policies by the end of the current financial year.
MobiKwik had also launched buying and selling of digital gold through SafeGold, a product comparable to competitor Paytm’s. The mobile wallet player had previously launched an instant credit product called Boost and entered wealth management services through the acquisition of Clearfunds. MobiKwik plans to spend close to $15 million (Rs 107 crore) over the next one year to develop its wealth management business.
Rival Paytm Money also builds investment and wealth management products for its users, all of which are delivered through a mobile application.
Paytm Money claims to have already partnered 30 asset management companies that cover over 94% of industry assets under management. It supports investing from over 190 banks through auto-pay mandates and net banking.
Users can opt to invest as little as Rs 100 through systematic investment plans or put in higher amounts through mutual fund schemes.
Paytm Money claims to offer only direct plans of mutual funds that come with lower expense ratio due to zero distribution fees or commissions, which in turn give investors a better return. The investment service is completely free for users.
Founded in 2009, MobiKwik competes with the likes of Alibaba-backed Paytm and Flipkart’s payments vertical PhonePe. MobiKwik, which counts Sequoia Capital, American Express, Tree Line Asia, MediaTek, GMO Payment Gateway and Cisco Investments Net1 among its investors, saw its valuation shrink 15% to $279 million in January as Bajaj Finance Ltd acquired more stake in the company.