MoneyOnMobile, a Dallas-based fintech investment company, is looking to invest about $100 million in Mumbai-based pre-paid mobile wallet and remittance service start-up My Mobile Payments Limited (MMPL).

MoneyOnMobile, formerly known as Caplain, is a listed company in the US, and entered the Indian fintech market in 2012 with MMPL. So far, it has invested about $30 million in MMPL, whose consumer-facing product was christened MoneyOnMobile post the funding.

Harold Montgomery, Chairman and CEO of MoneyOnMobile, told BusinessLine that the company is committed to the burgeoning Indian fintech market, and will invest heavily for the next 2-3 years to expand the operations across the country to reach and tap the unbanked population.

“We will be tripling our business in the next three years. We are only focussed in India, and are optimistic about our growth in this market,” Montgomery said, adding that poor internet connectivity in smaller pockets and an unbanked population will boost the growth.

MoneyOnMobile is a pre-paid wallet that does not require to be linked with any bank account. Consumers can go to any MoneyOnMobile-supported retail store and load money in the wallet by paying cash to the retailer. The money also works on feature phones. The company is now looking to enter the financial product segment, Montgomery said.

He further added that while demonetisation has given adequate boost to the growth of fintech apps, MoneyOnMobile witnessed a slight decline post November due to shortage of cash, which is the very premise of the business.

Cash is king

“We are tapping the unbanked, and hence, we have to deal with cash, and that’s a great opportunity for us as cash transactions are still at 80 per cent. Besides, we are helping the users, in a way, to get into the banking system,” he said, adding that the company is also acting as a banking correspondent for YES Bank and Ratnakar Bank. It had also raised about $1.5 million in unsecured credit from YES Bank, in 2016.

MoneyOnMobile in its analyst call for the December quarter had mentioned that due to demonetisation its net revenue plunged 39 per cent to $0.97 million during Q3FY17, from $1.61 million in Q3FY16. The gross profit stood at $0.58 million during the quarter, down 34 per cent year-on-year from $0.89 million in the same quarter last year.

This was also due to a rejig the company is carrying out in its business model to focus more on higher margin-based transactions such as domestic remittance, cash-out and card purchases. The company earns anything between 1-3 per cent as commission on different kind of transactions.

Montgomery also added that the firm had launched mobile ATMs across mom-and-pop stores in the country in November 2016, and the plan is to expand that business. The company claims to have about 190 million unique customers so far and carried out transactions worth $1.7 billion.

MoneyOnMobile is present in about 600 cities across the country with a dominance in Eastern and North-Eastern States, which is where it started its business. It has about 3,30,255-plus retail outlets in its network, from where consumers can either load or withdraw cash. The app is supported by 12 regional languages and about four call centres.

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