Net1 to invest $40 million in MobiKwik

NEW DELHI: Net 1 UEPS Technologies today announced that it has signed a subscription agreement with One MobiKwik Systems Private Limited (“MobiKwik”) in India.

As part of the strategic partnership, Net1 will invest $40 million (about Rs 268 crore) in MobiKwik. In addition, through our technology agreement, Net1’s Virtual Card technology will be integrated across all MobiKwik wallets in order to provide ubiquity across all merchants in India.

Net 1 UEPS Technologies, is South Africa-based a provider of payment solutions and transaction processing services across a range of industries and in various geographies.

MobiKwik is India's largest independent mobile payments network, trusted by over 32 million users and 100,000 retailers. MobiKwik’s current shareholders include Sequoia Capital, Tree Line Asia, American Express, Cisco Investments, GMO Payment Gateway and MediaTek, as well as Bipin Preet Singh and Upasana Taku, the founders and executive officers.

With Net1’s expertise and track record in facilitating financial inclusion across Africa, our strategic relationship with MobiKwik marks an important milestone from which we can leverage India’s substantial efforts to drive financial inclusion, down to the grassroots in rural and deep rural areas. Many of our solutions, most notably UEPS/EMV, are tailor-made to provide multiple financial and other services, increase accessibility, eliminate fraud and reduce cash,” said Serge Belamant, Chairman and CEO of Net1.

There are many similarities between South Africa and India including highly regulated markets, limited infrastructure and large unbanked populations. There have always been close ties and there is growing cooperation between the two countries, culminating with Indian Prime Minister Narendra Modi’s visit to South Africa last month. This transaction lends further support to their efforts to drive improving bilateral relations in trade and investment.

Upasana Taku, the co-founder of MobiKwik said, “ Our pioneering innovations in the fintech industry have helped us maintain this lead position, and with support from strategic partners such as Net1, we look forward to further strengthening our product offering and realize our vision to let users save, borrow, pay and invest using MobiKwik.”

According to a July 2016 Google-BCG study, the size of India’s digital payments industry will reach $500 billion by 2020, representing a ten-fold increase from current levels. The report predicts that more than 50% of India’s internet users are expected to use digital payments by 2020, and the top 100 million users are expected to drive 70% of digital payments by value. The report also predicts that the value of remittances and money transfers that will pass through alternative digital payment instruments will double to 30% by 2020.