BankBazaar.com raises Rs375 crore from Amazon, others
Firm is looking to use the funds in technology integration with a strong focus on mobile app, hiring and strengthening partner relationships
Mumbai: Online financial services company A&A Dukaan Financial Services Pvt. Ltd, which operates the BankBazaar.com website, said on Thursday it has raised ₹ 375 crore from investors led by Amazon Inc. The other participants were Fidelity Growth Partners, Mousse Partners and existing investors Sequoia Capital and Walden International.
The Chennai-based company that was founded in 2008 by Adhil Shetty, Arjun Shetty and Rati Rajkumar is looking to deploy the funds in technology integration with a strong focus on mobile app, hiring and strengthening partner relationships. It will also invest in marketing and branding initiatives.
The online financial services market in India was estimated to be ₹ 4,508 crore in December 2014 and has grown at a compounded annual growth rate of 20% since 2010, according to industry body Internet & Mobile Association of India. Start-ups in the online financial services sector are receiving investor attention. Policybazar.com raised $40 million in April, FundsIndia also raised ₹ 70 crore in June this year.
“The company has made great strides in the last two years and become the premier consumer destination for financial products. With this fund raise, BankBazaar plans to innovate even more to provide the best and fastest experience for consumers,” said Gautam Mago, managing director at Sequoia Capital.
BankBazaar has 23 banking partners and offers as many as 80 products under four verticals—credit cards, auto, personal and home loans. It plans to also launch other personal finance products as well. “The idea is to provide users with a portfolio of services. According to a survey carried out by us, 70% of the people surveyed research for financial products online,” said Adhil Shetty over the phone.
“BankBazaar is a unique and compelling service that aligns with Amazon’s mission in India to transform the way India buys and how India sells,” said Amit Agarwal, vice president and country manager, Amazon India.
The company has more than 800 employees and is looking to grow three to five times by the end of the current financial year. Out of the 4 million visitors per month 1-2% carry out transactions online. Shetty said the company aims to expand to smaller towns. “We believe that with smartphone penetration, mobile app will be the way we can deliver such services. We will not look at investing in physical infrastructure in such cities,” he added.
“The online financial sector is becoming very important and is poised for high levels of growth. The challenges for companies in this space would be unavailability of comprehensive data, formulating the right risk frameworks and stability in payment systems (most transaction are cash based today),” said Shinjini Kumar, lead banking and capital markets with PwC, a consultancy firm. “The pace of growth for the sector would depend on how quickly initiatives like digital India, payments banks, smart cities or make in India begin to show results.”
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First Published:3 Jul 2015, 01:38 AM IST
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