Hyperlocal financial technology company PayNearby said on Monday it has entered the insurance broking sector by acquiring We Care Insurance Broking Services Pvt. Ltd for an undisclosed amount.
The acquisition comes after PayNearby was granted an insurance broking licence by the Insurance Regulatory and Development Authority, it said in a statement.
PayNearby, operated by Nearby Technologies Pvt. Ltd, focusses on Aadhaar-based banking services, domestic remittances, and bill and card payments.
The acquisition will also see PayNearby launch a new product, InsureNearby, which will be led by We Care founder-director Murali Iyer. PayNearby will use its hyperlocal retailer network and partner with insurance providers to distribute the product. The company will also train its retail partners to distribute insurance products.
PayNearby founder and chief executive officer Anand Kumar Bajaj said the company will combine its distribution capability with We Care’s expertise to differentiate the new product. “Given the low penetration of insurance in the country, most Indians remain vulnerable to life’s unpredictability,” Bajaj said. “We hope to mitigate this by making insurance available through our network, in a format and construct that is easily available to all,” he added.
Founded in 2016, PayNearby operates on a business-to-business-to-customer model. The company was co-founded by Bajaj, Subhash Kumar, Yashwant Lodha and Rajesh Jha.
Bajaj said PayNearby enables financial inclusion transactions worth over Rs 4,000 crore every month. The company has partnered with institutions such as Yes Bank, RBL Bank, State Bank of India and CCAvenue.
The fintech segment has seen heightened investor activity over the past many months, with companies seeking to provide new-age products to customers across segments as well as address gaps in the financial services sector.
Last month, Tiger Global led a Rs 210 crore (around $30.2 million) Series B funding round in Bengaluru-based neo-bank Open, which provides collection and payout automation services for small businesses. The New York-based firm also led a $15.5 million (around Rs 107.73 crore) Series A round in OkCredit, which helps merchants keep track of payments and credit records via a mobile application.
Also in June, online payment gateway startup Razorpay Software Pvt. Ltd raised $75 million (around Rs 524 crore) in a Series C funding round. US-based Ribbit Capital and Sequoia Capital India led the investment. Existing investors Tiger Global and Y Combinator also participated.