Mobile banking firm mChek has closed its series-B round of funding, with Nexus India Capital infusing what could be between $5-8 million in it, VCCircle reported. VC firm Draper Fisher Jurvetson, which invested in the company in the first round in 2006, has also participated.
The company has competition in the form of other funded companies such as One97 (Intel Capital), Obopay (Nokia has invested a reported $70 million in it, other backers include Qualcomm, Redpoint ventures, Essar Telecom USA and AllianceBernstein) and Paymate (Kleiner Perkins Caufield & Byers, the Mayfield Fund, and Sherpalo Ventures) who are creating their niche in the ecosystem and tying up with banks and operators in a race to build up their offerings. This will enable them to attract consumers who, as we see it, are waiting for m-banking to become as distributed as online banking is today. A list of payment companies and tie ups is here.
Rural Market, Expanding Its Offerings
Though m-banking has not taken off as yet in India, with most of the 400 million mobile users unaware or hesitant to use it, things are slowly changing – SEBI is framing regulations for mobile trading to improve security and telcos are focusing on the rural sector. Micro-financing of mobiles and the growing number of applications and services for conducting money transfer, bank transactions, paying bills and registering for insurance etc., is expected to see a rise in areas where the Internet is still a rare commodity and online banking is not available. Currently m-payment companies are relying on SMS based transactions and shortcodes (users send Pay Airtel <amount> to mChek’s shortcode 543219, for example) but could launch more Mobile Internet based applications next year, when 3G is expected to pick up steam, enabling more data-intensive services on the mobile.
With the funding, mChek will be able to expand its bouquet, which currently includes prepaid top-ups and billing, IVR, mobile mall (buy movie tickets, buy flight tickets, pay insurance), money transfer (Western Union) and retailer kiosk services.