SUMMARY
PhonePe has onboarded former revenue secretary Tarun Bajaj, Walmart’s chief financial officer John D Rainey and chief people officer Donna Morris to its board
With this, the PhonePe board now has eight members. The existing members include founders Sameer Nigam and Rahul Chari, Flipkart cofounder Binny Bansal, Rohit Bhagat and Walmart’s Leigh Douglas Hopkins
PhonePe’s move to strengthen its board comes at a time when its rival Paytm is reeling under compliance and governance crisis
Fintech decacorn PhonePe has roped in three new members to its board as a step to fortify its governance and pave the way for a potential public listing in India.
The Walmart-owned company has added former revenue secretary Tarun Bajaj, Walmart’s chief financial officer John D Rainey and chief people officer Donna Morris to its board, Moneycontrol reported, citing a regulatory filing filed last month.
With this, the PhonePe board now has eight members. The existing members include founders Sameer Nigam and Rahul Chari, Flipkart cofounder Binny Bansal, Rohit Bhagat, and Walmart’s Leigh Douglas Hopkins.
PhonePe’s move to strengthen its board comes at a time when its rival Paytm is reeling under compliance and governance crisis. The Reserve Bank of India (RBI) clamped down on Paytm Payments Bank on January 31, 2023, barring it from taking any deposits or credit transactions or top-ups in any of its customer accounts. The central bank also stopped Paytm Payments Bank from providing any other banking services, such as UPI facility and fund transfers, after February 29, 2024.
Founded in December 2015 by Sameer Nigam, Rahul Chari, and Burzin Engineer, PhonePe offers financial services to users. It offers digital payment services, mutual funds and insurance products.
Meanwhile, a PhonePe spokesperson confirmed the board appointments in an email response to Moneycontrol.
“We would like to confirm that Tarun Bajaj will be an Independent Director on the PhonePe Board and Chairman of the Risk Committee.”
“We would also like to confirm that John D Rainey (Executive Vice President and Chief Financial Officer, Walmart Inc.) and Donna Morris (Executive Vice President, Chief People Officer, Walmart Inc.) have joined the PhonePe Board as Non-executive Directors,” the spokesperson said in a statement.
Earlier last month, the fintech major said it sold more than 90 Lakh insurance policies since foraying into the space in September 2021.
In a statement, PhonePe said it sold 40 Lakh insurance policies in the past one year. It also said that it contributed more than 65% to the growth of two-wheeler digital insurance in India in the past two years.
Overall, PhonePe claimed to have facilitated more than 7.5 Cr vehicle insurance quotes and 40 Cr quotes across its overall insurance portfolio.
Fintech majors such as PhonePe and Paytm leverage their existing user base to sell insurance products, while specialists such as Paisabazaar and PolicyBazaar have built a full-fledged marketplace to cater to customers looking for insurance products.
At the heart of all this lies the attractive Indian insurtech opportunity, which, as per Inc42, is projected to be the second fastest-growing sub-segment within the fintech sector by 2025. According to the data, insurtech will account for $339 Bn of the total addressable $1.3 Tn fintech market opportunity by 2025.
The space is also populated by players such as ENSUREDIT, Onsurity, Plum, Riskcovry, RenewBuy and Turtlemint.
PhonePe, flush with the $850 Mn it raised last year, is on an aggressive expansion spree as it seeks to become a leading fintech super app. The startup also launched its credit marketplace while it has been expanding its financial services portfolio to include digital gold, mutual funds, stock broking and lending.
It has also forayed into adjacent tech-enabled verticals such as hyperlocal shopping through Pincode and app marketplace via Indus App Store to accelerate growth and create alternate source of revenue beyond digital payments.
The Bengaluru-based decacorn’s consolidated net loss rose 39% to INR 2,795.3 Cr in the financial year 2022-23 (FY23) from INR 2,013.7 Cr in the previous fiscal year due to a sharp increase in its ESOP expenses.
PhonePe’s operating revenue surged an impressive 77% to INR 2,913.7 Cr during the year under review from INR 1,646.2 Cr in FY22. In comparison, the operating revenue of the startup’s archrival, Paytm, zoomed 61% to INR 7,990.3 Cr in FY23.
PhonePe primarily earns revenue through its payments and allied services. It earned INR 2,707.1 Cr from this revenue stream during the year under review as compared to INR 1,6301.4 Cr in the previous fiscal year.
