BackPhonePe receives insurance broking licence from Irdai
PhonePe can now distribute insurance products from all insurance companies in IndiaPhonePe also got in-principle approval from the Reserve Bank of India to operate as an account aggregator (AA)
PremiumBENGALURU : Payments major PhonePe has received an insurance broking licence from Insurance Regulatory and Development Authority of India (Irdai), the Bengaluru-based company on Monday said.
Last year, PhonePe entered the insurtech sector with a limited insurance ‘corporate agent’ licence, which restricted the company to partner with only three insurance companies per category. Now, with this new ‘direct broking’ licence, PhonePe can distribute insurance products from all insurance companies in India.
Since launching insurance on its platform in January 2020, PhonePe has unveiled offerings across general, term and health insurance on its platform.
The new broking licence will also allow PhonePe to start offering personalized product recommendations to its over 300 million users, and offering a much more diverse portfolio of insurance products for Indian consumers.
“This license is a big milestone in our insurance journey. This move to broking will give us further momentum and accelerate our growth in this space. We are building a robust, full service platform for our deeply engaged customer base through innovative products in partnership with high quality insurers. This move will lead us closer to our goal of becoming a one-stop destination for all the insurance needs of our customers," said Gunjan Ghai, vice president and head of insurance at PhonePe.
Last week, PhonePe also announced that it has got in-principle approval from the Reserve Bank of India to operate as an account aggregator.
The AA licence will permit PhonePe to launch its account aggregator platform that will enable free and instant exchange of financial data between the financial information users and financial information providers with due consent from customers, in a safe and secure manner.
Over the past years, PhonePe has also launched several mutual funds and insurance products like tax-saving funds, liquid funds, international travel insurance and ‘Corona Care’, a dedicated insurance product for its users.
The payment fintech’s strategic entry into the financial services segment is to diversify its revenue pool as payments continues to be a loss making business.
This comes at a time when merchant discount rates or transaction fees continue to be zero, after the Indian government decided in 2019 to waive the fee for digital transactions powered by Unified Payments Interface (UPI) and RuPay.
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