The 10-year-old Gurgaon-headquartered mobile payments firm MobiKwik has hit its profit goals and is now making money, as reported on Tuesday (Sept. 3).
“We have been in an ecosystem where we have seen a lot of high growth and several regulatory changes in the payments domain,” Bipin Singh, co-founder and CEO of MobiKwik, told the news outlet. “But what we realized was that payments alone is likely not going to be a very profitable business.”
To get on track, MobiKwik stopped looking for user growth and instead went after profit. While competitor Paytm raised more than $2 billion, it remains unprofitable and is predicted to continue on that path.
MobiKwik has raised about $118 million to date from Sequoia Capital, American Express and Cisco Investments, among other investors.
Co-founder and COO Upasana Taku said the company modeled itself after Kotak and ICICI, banks that have just a fraction of users compared to most payment apps, but are profitable. MobiKwik has 400 employees and 110 million users, she said.
MobiKwik reduced cashbacks and concentrated on user retention and other strategies to make money. It expects to hit $66 million in revenue by March 2020 and to be fully profitable by fiscal year 2021. An IPO could be on the horizon in another five years, the report noted.
In June, MobiKwik announced a partnership with Singapore-based DT One to expand into international markets. The partnership will enable the app to offer mobile recharge, rewards and airtime credit services in more than 150 nations across some 550 mobile operators. The service is geared toward Indians living overseas and immigrants in India.
With millions of Indians going overseas to pursue education or find employment, there is currently no convenient way for them to receive money from family and friends in India when their phones need to be topped up. This new functionality will enable this service, with no processing fees.