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Tag: Super.money

  • Super.money, Supported by Flipkart, Acquires BharatX to Enhance its Credit Offerings

    Flipkart Group’s UPI application, super.money, has purchased BharatX, a checkout financing platform supported by Y Combinator, for an unknown sum to enhance its current services, particularly in Buy Now Pay Later (BNPL). Checkout financing enables users to purchase things online in installments during the checkout process.

    In conjunction with the transaction, the principal team of BharatX will collaborate with super.money to enhance its services in the credit-on-UPI sector. Prakash Sikaria, CEO and founder of super.money, stated that the company regards credit-on-UPI as a transformative development for financial accessibility in India. By utilising BharatX’s platform, the organisation is creating distinctive credit-on-UPI solutions that correspond with its collective mission of financial inclusion, enabling millions to interact effortlessly.

    About BharatX

    BharatX, established in 2019 and located in Bengaluru, has partnerships with over 200 businesses for checkout financing alternatives via four financial partners, according to the company’s website. The startup secured $4.74 million through two fundraising rounds from investors including Y Combinator, Multiply Ventures, Soma Capital, Java Capital, and 8i Ventures.

    Mehul Jindal, Founder of BharatX, stated that during the past four years, beginning in college, BharatX has successfully extended credit to hundreds of thousands of people in India profitably, without requiring documentation or a credit score. Through this acquisition, the brand will elevate its offering by leveraging the broader distribution network of super.money.

    Super.money’s Operations

    Launched in July 2024, super.money ascended to become the sixth largest payments entity by November, surpassing Amazon Pay and WhatsApp Pay. In January, the firm reported a 24% month-on-month increase, enabling approximately 125 million transactions, according to data from the National Payments Corporation of India (NPCI), which manages UPI.

    The company introduced fixed deposits in November in collaboration with four small finance banks and is poised to launch credit products, including credit cards and personal loans, in the forthcoming months. The acquisition occurs as Super.money engages in advanced negotiations for a funding round between $35-40 million, spearheaded by Flipkart, with more external investors expected to join, according to a media report.

    Not a Full Acquisition Deal

    Sikaria stated that this agreement does not entail a complete acquisition of BharatX due to its current credit-related obligations. Super.money has purchased the technology, intellectual property (IP), and personnel, while BharatX will continue to function temporarily to oversee the current 12- to 18-month loan cycles before concluding its operations. Sikaria stated that Super.money intends to introduce several checkout financing solutions, utilising BharatX’s loan management, collection management, and risk underwriting technologies.

    Two products under development are BNPL ‘Khata’-style credit, allowing customers to make purchases throughout the month and settle payments at the end, and the ‘Paying Free’ installment plan, wherein users pay one-third of the total at the time of purchase, followed by equal payments in 30 and 60 days. The items are aimed at youthful people seeking to enhance their smartphones, fashion, and vacation experiences.

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  • Launching of UPI app from Flipkart backed Super.money

    The super.money app, which is a credit-first UPI (Unified Payments Interface) payments gateway app developed by India’s eCommerce giant Flipkart, intends to rapidly transition into a secured lending role in the next months.

    According to a press release issued by the fintech, the app had about one million downloads during the test phase, which resulted in more than ten million transactions. National Payments Corporation of India reports that monthly credit transactions on UPI exceed INR 10,000 crore.

    As a First Offering, Super.money Offers a Rupay Credit Card

    The RuPay credit card, which functions similarly to an interest-bearing wallet on the UPI platform, is the initial offering from super.money. Already, Super.money has released an additional product—unsecured personal loans—in partnership with leading banks in India.

    “The retail credit industry is booming and offers a lot of potential,” according to Prakash Sikaria, founder and CEO of Super.money, who spoke with a prominent media outlet. “Secured credit products have not been developed further and have not experienced the proper level of adoption,” he opined.

    According to Sikaria, the Tier II and III markets in India are where the credit on UPI opportunity lies. From the standpoint of the user, it presents a three- to fourfold potential compared to conventional credit cards. Specifically, he emphasised how the beta phase shaped the super.money experience and how they innovated at the forefront of UPI credit in a press statement.

    However, Super.money will have to distinguish itself through its products rather than relying just on UPI-backed transaction volumes if it wants to stand out in the still-growing but highly competitive lending industry, which is dominated by banks and NBFCs.

    Secured Vs Unsecured Loans

    The fast growth of unsecured loans in India’s retail loans segment over the past two years has been brought to the attention of the Reserve Bank of India in both informal meetings with banks and the formal publishing of the Financial Stability Report, which is done half yearly.

    The risks associated with certain categories of unsecured loans were given a higher weightage by the regulatory body in November of 2023. The intended outcome has already been achieved. Following the RBI’s action, the growth rate of credit card portfolios dropped from 30% to 23%. In a same vein, bank lending to NBFCs fell to 18% from 29% previously. 

    Secured loans (vehicle, home, loan against property) are safer bets than unsecured loans (personal loans, credit card loans, and other types of consumer durables and student education loans), which do not require collateral. Lending system vulnerabilities increase when combined with a regime of still-high interest rates.  

    Many fintech companies in India compete for customers in the secured lending market by offering digital loans collateralised by precious metals and fixed deposits. Banking institutions and non-bank financial companies (NBFCs) have a greater branch network and street fleet, allowing them to dominate other products like home and vehicle loans. 

    Sikaria has faith in the possibilities of the cosmos he intends to serve. According to his polls, a mere fifteen to twenty percent of individuals who apply for a credit card actually receive one. Financial product cross-selling is super.money’s goal in the unsecured lending market. 

    The plan is to attract and keep users with greater average revenue per user (ARPU) by offering them greater incentives. The goal for Super.money, similar to other fintechs, is to increase the percentage of users who purchase additional financial products through cross-selling.

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