Digital payments and financial services fintech PhonePe on August 31 said it has been issued an Insurance Broking licence from the Insurance Regulatory and Development Authority of India (IRDAI).
Last year, PhonePe had entered the insurtech sector with an insurance corporate agent licence, which allowed the company to partner with only three insurance companies per category i.e. health, life and general. With this direct broking license, the company can distribute insurance products from all insurance companies in India.
The new broking licence also allows PhonePe to start offering personalised product recommendations to its over 300 million users, and offering a much more diverse portfolio of insurance products for Indian consumers, the company said.
Since it entered the insurance segment in January 2020 as a corporate agent, PhonePe has launched offerings across general insurance, term insurance and health insurance. The company said that the overwhelming response to its early insurance product launches from customers encouraged it to apply for an Insurance Broking licence so it can rapidly expand its insurance offering for consumers.
Gunjan Ghai, Vice President & Head of Insurance at PhonePe said, “This licence is a big milestone in our insurance journey. PhonePe is India’s fastest growing insurtech and this move to broking will give us further momentum and accelerate our growth in this space.”
“We are building a robust, full-service platform for our deeply engaged customer base through products in partnership with high quality insurers. This move will lead us closer to our goal of becoming a one-stop destination for all the insurance needs of our customers,” he added.
The licence is part of PhonePe’s larger plan to be a full-fledged financial services provider and comes less than a week after PhonePe received in-principle approval from the Reserve Bank of India (RBI) to operate as an account aggregator.
Speaking at Walmart’s Converge event recently, PhonePe Founder and Chief Executive Officer Sameer Nigam and Founder and Chief Technology Officer Rahul Chari had said that customers are now slowly moving from payments to managing their investments online and this is the opportunity to re-think how financial services have been done so far.
“We have the sole consumer strategy - send money, spend money, manage money and grow money. Send and spend is all that we have actually achieved so far, that habit has been set. Now, users who have adapted to the platform are ready to manage and grow their money,” Chari had said.
PhonePe is a leader in the digital payments space with the highest share of UPI transactions and over 300 million registered users. The company had forayed into financial services in 2017 with the launch of Gold providing users with an option to buy 24-karat gold on its platform.
It has also widened its offerings since then to include several Mutual Funds and insurance products. The platform has over 20 million customers on its platform, and 80 per cent of its users from non-metro cities.
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