MobiKwik fast emerging as leader in Indian ‘Buy Now, Pay Later’ (BNPL) Market
India's largest BNPL FinTech player, MobiKwik, is well-positioned to leverage the $50 billion Indian BNPL opportunity by 2026. MobiKwik Zip is the only BNPL product sitting on the foundations of payment rails, linked to 120 million MobiKwik users’ wallets, and can be accepted at a vast merchant network including 3.4 million offline and online merchants.
_1650455177271_1650455183861.jpg "MobiKwik Zip is addressing the unmet credit needs of the digitally savvy millennials from Tier 1, Tier 2 and Tier 3 cities and towns of India.")
PremiumBuy Now Pay Later (BNPL) industry is changing the way we shop and pay. The BNPL market has developed at blazing speed in recent years and transformed the lending industry globally. It has proven to be a very successful model in developed nations such as the USA, Sweden, and Australia where it has grown into a multi-billion-dollar industry.
In India, BNPL business is expected to see a ten-fold surge over the next four years – a jump from about US $ 3-3.5 billion now to US $ 45-50 billion by 2026. The increase is being attributed to low credit penetration, rising number of smartphone users and boom in the online shopping trends from all parts of the country. It is true that India is a home to the largest millennials and GenZ population which are adding to the exponential growth of smartphone users and prefer convenient ways of digital payments for their daily life use cases. However, it is also true that formal credit has only reached 4% of the population in India which is abysmal when compared to other developed nations. The inequality of credit distribution in India is evidenced by the fact that household credit utilization as a percentage of GDP in India was 11% as compared to over 75% in developed economies, such as the USA and UK. The gap between the growing base of users paying digitally which currently stands at 250 million, and the number of unique credit card holders in the country, which is just 30-35 million, is only widening further.
BNPL is changing the face of Credit in India and has the potential to bring a massive digital financial revolution. India presents a huge consumer credit gap and has significant headroom for growth for seamless credit alternatives like BNPL. BNPL's user base is expected to reach approximately 80-100 million users by fiscal 2026, far surpassing the unique credit card user base in the country.
A technology first company like MobiKwik is well positioned to leverage Indian BNPL opportunity by offering consumers a BNPL product, MobiKwik Zip which solves their pain point of access to credit for daily life. The product which was launched to bridge the credit gap in India and provide the unserved Indian population their first credit experience has become a product of choice for 25 million consumers. MobiKwik Zip is addressing the unmet credit needs of the digitally savvy millennials from Tier 1, Tier 2 and Tier 3 cities and towns of India. It is the only BNPL product sitting on the foundations of payment rails which is linked to 120 million MobiKwik users’ wallets and can be accepted at a vast merchant network including 3.5 million offline and online merchants.
MobiKwik is currently the largest BNPL Fintech company in India with 25 million pre-approved BNPL users and an active user base of 2.8 million. The company has witnessed an exponential growth with 32 X increase in active Zip users and 157 X growth in Zip transaction volume.
The segment GMV has seen an increase of ~840 % Y-o-Y for the nine months ended December 21.
_1650455338141.jpg "Here is the increase in segment GMV")
MobiKwik’s first mover-advantage, a strong user funnel of pre-approved BNPL users leveraging its consumer payments platform coupled with a 3.4 million strong merchant ecosystem (online + offline) has led to ever increasing user adoption and engagement with monthly spends of ~INR3,245 and 81% repeat rate.
MobiKwik Zip, the flagship 15 days interest free product continues to see strong user uptake and engagement as evidenced in increase in active users and number of transactions.
For the uninitiated, MobiKwik Zip is an interest-free product with ₹500-30,000 credit limit available in the user’s MobiKwik Wallet with a one tap activation in 15-day cycles.
MobiKwik’s consumer payment platform provides MobiKwik with an existing base of 120 million users, a rich user data history having handled >US $ 7 billion worth of transactions just in the last 3 years, KYCs of 50 million users, necessary for offering financial services and a strong merchant ecosystem, where BNPL can be used, giving users a huge flexibility to transact for their daily life use cases.
A combination of the above helps the company keep its user acquisitions cost low, better access to user quality, and provides amongst the widest merchant network across all BNPL players. Its consumer payment platform serving as its moat along with its razor-sharp focus on BNPL, the company is strongly positioned to leverage the fast-growing BNPL opportunity in the country.
One of the important variables that will push BNPL demand even higher in 2022 or beyond is a shift in consumer behavior from savings-focused to consumption-focused.
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