MobiKwik wallet numbers rise as banking players go through downturn

Among the non-bank players, MobiKwik had about 134.1 million wallets in January, which rose 2 per cent to 136.8 million in May, ranking the company second in terms of wallet numbers

Fintech major MobiKwik's PPI (prepaid payment instrument) wallets have seen their market share expand to about 12.11 per cent in May, up from 9.3 per cent in January, in terms of total number wallets. The Gurugram-based company saw this surge and expanded its presence into tier-II and -III cities as other major players in the banking space went through a downturn. MobiKwik also attributes the growth in its numbers to its expansion drive.

MobiKwik also saw its overall Gross Transaction Value (GTV) share — in terms of purchase of goods and services, and fund transfers — almost double from 11 per cent in March to 23 per cent in May on the back of growth in its Pocket UPI service, a wallet feature that the company introduced in February.

Among the non-bank players, MobiKwik had about 134.1 million wallets in January, which rose by 2 per cent to 136.8 million in May, ranking the company second only to PhonePe in terms of wallet numbers. PhonePe had about 199.3 million wallets as of May.

“Banking on wallet interoperability, we built a feature called Pocket UPI where users can use their wallet over the UPI ecosystem. Another large wallet player went through their own regulatory decline due to which their users were looking for another product of good quality serving their purpose,” said Upasana Taku, co-founder and chief financial officer (CFO), MobiKwik, in an interaction with Business Standard.

In January, after the Reserve Bank of India (RBI) placed crippling restrictions on Paytm Payments Bank, the company’s wallet operations came to a standstill.

The Noida-based company, an associate entity of One97 Communications which operates brand Paytm, saw its wallet numbers decline 39 per cent from 630.7 million in January to 380.5 million in May, respectively.

Similarly, Airtel Payments Bank, another bank player, saw its wallet numbers decline about 49 per cent during the same time, Business Standard reported last week. The company stated that the fall in the numbers is because they weeded out dormant zero wallet accounts.

“Net new users are also joining the digital ecosystem. First time users are figuring out how they can transact digitally. Roughly about 70-75 per cent of new users are coming from tier-II and -III cities and towns in India,” Taku added.

Growth in MobiKwik’s payment transaction figures comes as the fintech firm is gearing up for an initial public offering (IPO). The company, which plans to raise Rs 700 crore, had refiled its draft red herring prospectus (DRHP) in January.

With the second filing of the DRHP, the company is planning to mop up less than half of what it had aimed to raise earlier.