Ola Financial Services have raised about Rs. 205 Crore in its first institutional financing round from Falcon Edge and Matrix Partners which also saw participation from Apoletto Managers and Arun Sarin’s family office. The latest development is expected to have brought the company’s valuation at $250 Million. Vikram Vaidyanathan, MD of Matrix Venture has also joined the board of the company in wake of the deal.
Ola is planning to expand beyond its ride business and thus in an attempt to scale up its financial services, it had already raised $20 Million as working capital loan before the latest funding. Bhavish Aggarwal, CEO and Co-Founder of Ola believes that the financial service sector in India as well as abroad is majorly underserved because of weak distribution, low trust and complicated products.
Bhavesh addressed an email to his employees stating that their company has a chance to change this scenario with the reach of their existing ride-sharing business. Even the Covid-19 crisis has created a need to innovate the financial services products to make them more consumer friendly and digital first.
Ola Money has short term credit, mobile wallet, insurance and bill payments in tis existing pool of services. The company separated from its parent company, ANI technologies in November last year and raised funds independently. Covid-19 has had a huge impact on Ola’s business as it dipped by 95% in last 2 months due to the nationwide lockdown.
The company has decided to strengthen its financial services business meanwhile the market recovers. It is also competing with the likes of already well-established companies like Paytm, Google Pay, AmazonPay, PhonePe and the awaited WhatsApp Pay. The post-paid business of Ola Money has started showing positive lines on the graph and has become fifth-largest issuer of credit in the country.
The firm has also applied for non-banking finance company (NBFC) license in January and has partnered with Religare for health insurance, Zipcash for wallet business and with SBI to launch credit cards.