The company already has assets under management (AUM) worth Rs 101 crore for the product, co-founder Upasana Taku told ET in a call.
The product, which was tested for the past month, allows users to invest as little as Rs 1,000 and is expected to provide interest of up to 12% per annum on these deposits, with an option to withdraw the corpus at any time.
The deposits will be invested by a non-banking finance company (NBFC) partner as loans to MobiKwik customers. MobiKwik has partnered with P2P NBFC LendBox for the offering.
MobiKwik’s Xtra is not a new offering in the fintech industry, with several other firms including Cred and BharatPe foraying into the P2P lending category last year. Last week, Cred said it was investing $10 million in P2P NBFC Liquiloans, which powers its P2P lending product Credit Mint.
Liquiloans is also working with Cred on its Cred Cash line of credit product.
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“Most of the P2P investment products from other fintech companies are focused on select segments of users. We wanted a large base to take advantage of the returns. We also offer up to 12% returns, higher than some other fintech firms, with a low investment barrier to entry of Rs 1000. We launched Xtra keeping in mind that traditional financial instruments such as fixed deposits offer interest of up to 6% currently,” Taku said.
She added that the company is confident of returns as the deposits will be returned by Lendbox as loans to its MobiKwik customer base. MobiKwik currently offers instant loans and buy-now-pay-later solutions to its users.
For the year ending March 31, 2022 (FY22), revenue earned from credit accounted for almost 25% of MobiKwik’s total revenue. However, in the last few months, credit has already increased to 50% of MobiKwik’s monthly revenue this fiscal, Taku added.
Earlier this month, MobiKwik announced its FY22 fiscal results. It reported an 80% rise in revenue to Rs 543.2 crore, while losses widened 15% to Rs 128.16 crore from Rs 111.3 crore in FY21.
“For this financial year (FY23), financial services (including credit) will be 50% or higher in terms of (total revenue) contribution. And in the next fiscal it will definitely exceed the payments.
The GMV (gross merchandise value) of payments is also growing. It grew by 130% between FY21 and FY22. But the margins in this business are low, especially compared to financial services,” Taku added.
MobiKwik claims to have 130 million users and 3.7 million merchants on its platform.
The company has put plans for its initial public offering (IPO) on hold amid a broader correction in fintech valuations.
MobiKwik received approval from the capital markets regulator, the Securities and Exchange Board of India (Sebi), in October last year to go ahead with a Rs 1,900-crore IPO.
Recently, the Reserve Bank of India (RBI) reportedly rejected MobiKwik’s application to operate Zaakpay, its payment gateway service, as a payment aggregator. ET reported on September 2. Taku said the company would reapply for a license.
ET reported on July 28 that the RBI had opened another window for payment aggregators to seek regulatory approval as terminating those without a license could lead to disruptions in the system.