FreeCharge looking to cash in on fintech boom

BENGALURU: In a phase of rediscovery, Gurgaon based digital payments company Freecharge is looking at adding multiple financial services on its application beyond payments, across insurance, lending and even allowing customers to directly open bank accounts. The payments company which is now a wholly owned subsidiary of private sector lender Axis Bank, is looking at starting the financial services within the next four months, said its top executive.

“We are already seeing decent traction on the app in terms of user adoption, we want to take the services offered on Freecharge a step ahead to all forms of financial services like insurance, loans and savings through Axis Bank,” said Sangram Singh, the chief executive officer at Freecharge. “We are already using Freecharge as a sourcing point for Axis’ instant account opening proposition Axis ASAP.”

Singh who was heading digital payments in the bank joined Freecharge after the Axis acquisition last year. He is hoping to bring a balance between his banking expertise and the tech skills of Freecharge to take the company to the next level and also win back customers who had jumped ship during its rough days.

For Axis Bank, Freecharge also fills the void left behind by the bank’s wallet proposition Lime which was closed down in January when the bank started to migrate its systems to Freecharge.

“With the opening of new options like UPI, we have seen an addition of 2.5 million new customers on Freecharge, a 40% jump in monthly active users on the platform and even 45% higher payments happening through the app,” said Singh. “We have also earmarked a budget to promote our products through incentives and discounts to accelerate customer acquisition in this competitive world of digital payments.”

The company is banking majorly on industry initiatives like BharatQR and UPI to help it take the payment product to consumers beyond the metros and also help it in acquiring offline merchants to increase adoption.
Also planning to use the app as a sourcing point for customers of Axis Bank, Singh said that with the support of a fullfledged bank, it will be easier for Freecharge to take its products to their target consumers who are mostly digital natives and would not be Axis customers already.

“The aim for Freecharge is to take the bank to the larger population of non-Axis Bank customers who could use digital payments as the first step towards adopting a complete digital financial services offering from the bank,” he said.

To support the plans, the company has also increased its staff strength by 30% to presently around 256 people and has operations across Bengaluru, Mumbai and Gurgaon where they have built the new head office.

Freecharge which was acquired by ecommerce company Snapdeal for $400 million from its founders in 2015 was in turn sold off to Axis Bank at Rs 385 crore in 2017, showing the enormous erosion in value proposition for the payments app. Now Singh is fighting a two pronged battle while reviving Freecharge, one is to re emerge as a relevant player when competitors have gained vital ground and the other is to prevent Freecharge from becoming just another bank led payment initiative.

This article appeared in THE ECONOMIC TIMES dated May 17th 2018.

 

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