Here's Ola's Plan To Diversify its Offerings to Strengthen Footprint in Fintech
Grow Your Business, Not Your Inbox
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
Bengaluru-based cab aggregator Ola is trying to strengthen its position in the fintech space. In order to diversify its offering beyond the ride-hailing business, Ola’s parent ANI Technologies is planning to spin off its fintech business Ola Financial Services (Ola Money) as a separate entity.
According to The Economic Times report, the company’s board has already approved the plan of setting up Ola Financial Services as an independent entity. Ola is also looking to raise funds separately for this unit. Citing unnamed sources, the report also said Ola Financial Services business alone may become ready for IPO within the next three-four years.
The report also said that currently Ola Financial Services is being led by former PayU CEO Nitin Gupta. In addition, veteran banker Hemant Kaul was also appointed on the board of Ola Money.
Ola’s Fintech Focus
The cab-hailing company entered the fintech segment in 2015. Currently, several services such as short-term credit, mobile wallet and insurance, among others, are available as a part of Ola Money.
In January, reports said Ola applied for a non-banking financial company (NBFC) licence in order to boil down its efforts for offering short-term credit service. The company also launched an Ola Money-SBI Credit Card in May and currently plans to issue nearly 10 million credit cards by 2022.
With this move to set up Ola Money as a separate unit, the company will now be directly competing with other notable players such as Paytm, Google Pay, and PhonePe, among others.
Ola did not respond to Entrepreneur India’s query regarding the development.
Ola has been focusing extensively towards growing its business and diversifying its offerings. In October, Ola launched its self-drive car-sharing service ‘Ola Drive’. The service has been initially rolled out in Bengaluru and will be eventually expanded to Hyderabad, Mumbai and New Delhi. Users will be allowed to book a car of their choice by paying a security deposit starting at INR 2,000.
In a bid to strengthen its electric vehicle offering, Ola had launched Ola Electric Mobility as a separate business entity in March 2019. The company also entered the Unicorn club within few months after it raised $250 million in Series B round from Softbank. The entity has also been backed by notable investors including Tiger Global and Matrix Partners. Ola Electric has also been backed by Ratan Tata, chairman emeritus of Tata Sons. Apart from driving and fintech services, Ola is also bullish on foodtech segment. In October, the company launched its cloud kitchen services in Bengaluru.