After ruling the Indian cab market, Ola has become the latest Indian startup to apply for an NBFC license. With this, Ola will be able to enter India’s financial services sector and sell financial products such as loans, credit cards, and insurance.
Ola is looking to capture this market from long. This isn’t their first move into the financial space. It already has its own wallet called Ola Money which lets users pay at the end of the month for its rides through Ola Postpaid.
Also, Ola helps its driver partners negotiate better loan terms from banks, and even insures rides for its customers. Most of these services are currently run in association with financial institutions. After NBFC license, Ola will be able to run financial services independently on its own.
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To start with, Ola can use data collected from its driver partners and its customers. The company already knows exactly how much its drivers earn per month, and can use this data to offer them financial products. Through the customer’s panel and the locations one visits, it can also create estimates of how much money they likely make as well. Also, they have the added benefit of owning Foodpanda — the kind of food customers order will help it estimate income levels, and provide financial services.
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Ola isn’t the first Indian startup to use its data to provide financial services. Tech giants like Amazon, Flipkart and Xiaomi have all applied for NBFC licenses. It isn’t yet clear if they’ve utilized them in any form. Paytm has gone a step further with its own payments bank to provide financial services.
