After the entry of new age e-commerce giants Paytm and Mobikwik, the competition in the online mutual fund distribution space is heating up.
India’s largest e-commerce giant Flipkart will start distribution of financial products like mutual funds and insurance through its digital payment service PhonePe.
The Registrar of Companies RoC filings shows that the company has recently incorporated PhonePe Wealth Management Services. The filings says that the company will act as agent and advisor for financial services such as mutual funds and insurance.
In September, Flipkart received corporate agency license from IRDAI. IRDAI has given composite license to Flipkart that allows the company to sell insurance policies of three life, three non-life and three stand-alone health insurance policies.
To begin with, Flipkart is said to target its sellers to distribute financial products.
Chinese e-commerce giant Alibaba followed a similar strategy where they deployed the surplus funds of their sellers in liquid funds through their wealth advisory arm Ant Financials (then Alipay), which proved to be a big success. Later, the company expanded their distribution business by offering other mutual fund schemes and financial products.
Earlier this year, Paytm and MobiKwik rolled out their financial distribution and advisory business. Other e-commerce giants like Amazon already own stake in online distribution and robo advisory firm, BankBazaar. Similarly, Snapdeal had also invested in financial services startup Rupeepower, which helps people compare credit cards and loans across banks.
