One MobiKwik Systems Secures RBI Approval for NBFC

One MobiKwik Systems has achieved a significant milestone by obtaining approval from the Reserve Bank of India (RBI) for its NBFC application. This development represents a crucial phase for the Gurugram-based enterprise as it transitions into a comprehensive financial services platform.

As stated in its disclosure to the stock exchange, this approval will allow the company to initiate its lending operations via its wholly owned subsidiary, MobiKwik Financial Services Private Limited (MFSPL). However, actual operations are set to begin only after acquiring the Certificate of Registration (CoR) and meeting specific regulatory requirements.

Advantages of the NBFC License for MobiKwik

The NBFC licence will empower MobiKwik to originate and underwrite loans independently, thereby enhancing its business model beyond reliance on third-party lenders. This strategic move is anticipated to improve profit margins, facilitate quicker market introductions for new offerings, and reinforce management over credit underwriting and risk assessment.

Targeted Credit Products for Consumers and MSMEs

The firm plans to provide a range of both secured and unsecured credit products, particularly aimed at underserved segments in Tier II and Tier III markets. Additionally, MobiKwik intends to utilise its advanced technology framework, AI/ML capabilities, and extensive user base of over 186 million to offer customised financial solutions.

Competitive Landscape of NBFCs

By gaining this approval, MobiKwik joins other prominent companies such as IndiaGold, Flipkart, Newtap, Lendingkart, KrazyBee, and Capital Float, which also hold NBFC licences and operate as regulated lenders with improved oversight of their credit operations.

Following this announcement, the shares of the company surged by over 15%, reaching a 52-week peak of Rs 241, which elevated its overall market capitalisation to around $200 million.