PhonePe deepens foray into India’s retail insurance sector

PhonePe, India’s second largest digital payments company, has been issued an Insurance Broking licence from the Insurance Regulatory and Development Authority of India (IRDAI), allowing the company to roll out insurance products to millions of consumers across India.

Last year, the Bengaluru-based fintech startup 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.

The new broking license also allows PhonePe to start offering personalised product recommendations to its 300-plus million users, and offering a much more perse portfolio of insurance products for Indian consumers.

Gunjan Ghai, Vice President and Head of Insurance, said this license is a big milestone in the company’s insurance journey. “This move to broking will give us further momentum and accelerate our growth in this space.”

PhonePe forayed into the insurance segment in January 2020 as a ‘corporate agent’ and has since launched offerings across general insurance, term insurance and health insurance.

In March, PhonePe processed 1.19 billion Unified Payments Interface (UPI) transactions worth Rs 2.31 lakh crore, cornering 44% of the UPI market, even as its closest competitor Google Pay with 957 million transactions had a share of 35%.

Since 2019, the company has been offering small-sized tailormade investment plans for its customers in the mutual fund space. PhonePe targeted its wallet-based user base marketing the mutual fund investments as “fixed deposit-like returns” on the wallet money.

The fintech startup has also made nascent forays into India’s insurance intermediary space as well as a consumer-facing distributor for insurance firms.