Ola money to compete with Paytm, Freecharge
BENGALURU: Taxi-hailing service provider Ola has launched a dedicated mobile payments app, Ola Money, putting it in direct competition with Paytm and Freecharge, among others. Valued at $5 billion, Ola started life as a cab aggregator. But it has been diversifying aggressively into new business segments over the past year — such as grocery delivery, and online food delivery via Ola Cafe — even as it has added autos and buses to its platform.
Ola’s new mobile payments business is powered by ZipCash where the SoftBank-backed company has invested about Rs 5 crore for a minority stake, sources told TOI. At present, Ola Money will allow users single-point access across multiple brands and use cases.
It can be used for mobile phone recharges across all operators as well as for sending money to friends and family. A senior official of the company said the company had opened the platform in August to third-party merchants and gained decent traction, resulting in a dedicated app by Ola.
“We are in an advanced stage of talks with leading players in segments such as travel and entertainment, where repeat usage is higher. We are live with about 50 merchants now and will continue to add more,” said Rushil Goel, head of Ola Money. According to him, half of transactions on Ola’s cab platform is occurring via Ola Money. Ola has about 2,50,000 cabs and 75,000 auto rickshaws on its platform in over 100 cities.
“The average amount of money being kept in our wallet is higher than that of competitors, which is a good sign,” Goel claimed.
Backed by heavyweight investors like DST Global, SoftBank and China’s largest taxi aggregator app Didi Kuaidi, among others, Ola is fighting a bitter battle with Uber in India, which is fast catching up with the local player.
The Alibaba-backed Paytm became one of the first movers in the mobile payments sector locally. Earlier this year, the SoftBank-backed Snapdeal acquired Freecharge to enter the crowded market. Higher transaction rates and relatively cheaper customer acquisition costs are some of the key reasons behind major e-commerce companies betting on this space.