Online marketplace Snapdeal has bought a majority stake in cash and stock in Gurgaon based RupeePower, a financial products and services platform. Although the financials of the deal were not made public, post the deal, Snapdeal will offer a financial services marketplace and financial services like home, auto and personal loans, credit cards and extended warranty among other services.
A TechCrunch report states that Snapdeal will provide loans worth $1 billion over the next two years through this platform. Snapdeal aims to address distribution challenges of financial services in India. RupeePower will focus on scaling up the platform.
In August last year, Snapdeal tied with Capital Float to launch Capital Assist to provide sellers access to working capital loans. It raised over Rs 50 crore for over 150 sellers on its platform last week. For this, Snapdeal partnered with over 12 banks and NBFCs which included Axis Bank, ICICI Bank, HDFC Bank, RBL, Religare and L&T Finance. These institutions would provide financing to sellers depending on their current and future business requirements. The company claimed that through this initiative, small and medium sellers doubled their turnover within 2 months of availing assistance.
Interestingly, RupeePower also has partners in ICICI Bank, Standard Chartered Bank, Kotak Bank, Bajaj Finserv and American Express among others. It offers home, car and personal loans, credit cards and tools where users can calculate EMIs and compare financial services.
In October last year, Japan’s Softbank invested $627 million in Snapdeal and was reportedly in talks with China’s Alibaba for another round of fundraising. Last month, it announced raising $80 million from San Francisco-based hedge fund Valiant Capital Management and Hong Kong-based hedge fund Tybourne Capital Management, with participation from existing investors. Snapdeal says that it hasn’t yet touched the money raised through Softbank and are not looking to raise money immediately. It added that it is well capitalised for over 2 years.
Earlier this month, in a bid to strengthen its supply chain infrastructure, Snapdeal picked up a minority stake in logistics firm GoJavas. However, it did not reveal the size of the investment. Snapdeal was looking to invest $150-200 million in the logistics space over the next year, looking to complete deliveries within four hours.
RupeePower was founded by Tejasvi Mohanram in 2011. The company claims to have worked with over 100,000 customers in financial services and enabled credit disbursal of Rs 1,500 crore through its platform.