Mobile payment growth in India is on fire, going from just under 100 thousand mobile transactions in September of 2012 to over 700 thousand by July of 2013, according to a report by Deloitte reported on by Cisco.
As mPayments and mobile phone users’ numbers skyrocket, investors are noticing and with that international attention comes funding increasingly flowing into the subcontinent. Mumbai-based MoneyOnMobile, which allows users to use SMS text functionality to pay for goods and transfer funds between phones, saw significant investment from Dallas-based Caspian about a year ago.
Today the service boasts 82.5 million unique phone number customers-to-date and over 186,000 retail partners offering the service in India. It is sometimes referred to as “the PayPal of India.”
Their customers base is generally under-banked or entirely unbanked, and the service allows urban workers to connect with direct fund transfers to loved ones in rural areas where banking services are often lacking.
“Mobile phones saw exponential growth in India in 2007 and by 2008 had virtually become ubiquitous,” said founder and president Shashank M. Joshi. “I was wondering how could I use my experience to start payments business in India. I thought if I could facilitate financial transactions on the phone it would bring lot of convenience to the people and MoneyOnMobile was born.”
According to sources at Caspian, the fund has already invested around $1 million in the firm, and plans to invest $5 or $6 million more in the near future.
MoneyOnMobile is just one example of a firm collecting funds internationally. Bangalore-based Ezetap Mobile Solutions raised $8 million in a funding round led by Helion Advisors and mobile point of sales payment firm Mswipe Technologies raised $7 million in 2013 from Matrix Partners. In smaller but notably funding news, Mumbai-based Mosambee raised $700,000 from SIDBI Venture Capital in April 2013.
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