eCommerce major Snapdeal has picked up majority stake in digital financial products platform, RupeePower, for an undisclosed amount through a stock and cash deal.
The move will help Snapdeal to enter the Rs 4,500 crore online financial services market in the country.
“Consumers often face difficulty while deciding and buying financial products/services. This partnership will help solve distribution challenges of the financial services ecosystem and make it more inclusive,” Snapdeal co-founder and CEO Kunal Bahl told reporters.
Founded in 2011, Gurgaon-based RupeePower offers a digital distribution platform for loans, credit cards and other personal finance products. At present, it has 40 employees.
“Over the next one year, we plan to ramp up our headcount to about 200 people. Most of these will be engineers, who have an understanding of the financial services market,” RupeePower founder and CEO Tejasvi Mohanram said.
RupeePower aims to become the No 1 originator of financial products over the next couple of years with the investment received from Snapdeal, he added.
Snapdeal also runs a ‘Capital Assist’ initiative, under which its helps its sellers to secure financing to expand their operations.
Launched in August last year, the company has already helped over 150 sellers raise over Rs 50 crore through the initiative.
Asked if Snapdeal is looking at raising funds, Bahl replied in the negative.
“We have used our funds in a very efficient manner. Raising money is a full time job and we want to focus on our business. We want to bring entrepreneurs on board (who have products and solutions) because in the long term that will help sustain the business,” he said.
Bahl said he will look at growing Snapdeal through both organic and inorganic routes.
Snapdeal has raised more than USD 1 billion, including funding from Japanese telecom giant Softbank (USD 627 million or Rs 3,762 crore) and former Tata Group Chairman Ratan Tata (personal investment).
Its other investors include eBay, Tybourne, Myriad, Blackrock Inc, Temasek and Premji Invest.
Snapdeal claims to have over 40 million registered users and one lakh sellers on board.