Gurugram-based digital wallet start-up MobiKwik has raised US$40 million (nearly Rs 270 crore) from Net1, a South African payments technology entity specialising in developing solutions for the unbanked in developing nations.
Net1 is listed on Nasdaq, the American stock exchange, and has a market capitalisation of $482 million.
Net1 UEPS Technologies, Inc. through its technology agreement will also integrate its virtual card technology across all MobiKwik wallets.
The tie-up provides an entry point to Net1 into the fast growing digital payments market in India. Integrating the Virtual Card technology on its platform will eliminate the need to tie-up with retailers for MobiKwik, providing easier acceptance across multiple use cases.
With Net1’s experience in building solutions for users in Africa’s hinterland, MobiKwik could gain an edge over rivals such as Novopay which are heavily focused on serving rural customers in India. More, both companies share the same goal of enabling low-cost cashless transactions which giants such as Visa and MasterCard can’t.
Net1 is universal electronic payment system (UEPS) uses biometrically secure smart cards that operate in real-time but offline. Through Transact24, Net1 offers debit, credit and prepaid processing and issuing services for Visa, MasterCard and ChinaUnionPay in China and other territories across Asia-Pacific, Europe and Africa, and the US.
MobiKwik allows users to load money into a digital wallet using cash, loyalty points, debit card, credit card and net banking, after which it can be utilized to make purchases online. It enables users to discover retailers (brick-and-mortar stores, e-commerce websites, m-commerce apps, billers etc) and then start paying them.
It currently claims to be connecting 32 million users with 100,000 retailers. It also counts investors such as Sequoia Capital, American Express, Tree Line Asia and Cisco Investments on its board.
It is currently powering payments for companies such as Uber, Meru Cabs, Big Bazaar, Oyo, Zomato, Barista, PVR, Archies, BookMyShow, Grofers, Big Basket, Domino’s, Pizza Hut, WHSmith India, Myntra, Jabong, Pepperfry, MakeMyTrip, Cleartrip and Yatra. Last year, it also tied up with state-run Indian Railway Catering and Tourism Corporation (IRCTC) to offer its wallet service as a payment option for customers on IRCTC’s Android mobile app.