PhonePe, a digital payments and financial services platform, said on May 18 that it will acquire wealth tech businesses WealthDesk and OpenQ as part of its ongoing effort to diversify its financial services offerings beyond payments.
While the corporation did not disclose the deal’s worth, NBB has learned that the acquisitions total roughly $70 million, according to sources familiar with the situation.
“PhonePe is acquiring WealthDesk (Wealth Technologies & Services Private Limited). The founder and the entire team will be working as a part of the PhonePe group and both the platforms will remain independent,” the company shared in a statement.
“PhonePe is also acquiring OpenQ (Quantech Capital Investment Advisors Private Limited), subject to necessary regulatory approvals. OpenQ is a smart beta wealth management platform, which designs investment strategies and optimal portfolio construction advice. Post acquisition, OpenQ will be instrumental in creating the Wealth Ecosystem for the PhonePe Group,” the statement added.
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While PhonePe has a 47 percent share of monthly UPI transactions, co-founder and CEO Sameer Nigam has stated that the business intends to become a financial services group.
UPI, like RuPay debit cards, is subject to the zero-MDR policy, which states that merchants should not be charged a fee for taking payments using this mode. The merchant discount rate, or MDR, is a significant source of revenue for the payments industry.
Because UPI generates no money, it serves as a customer acquisition funnel for PhonePe’s other financial services offerings, including as mutual funds, insurance, and gold investments.
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WealthDesk will continue to be an open platform for all parties, according to PhonePe, and founder Ujjwal Jain will continue to oversee the company. The firm is a B2B2C (business-to-business-to-consumer) investment technology platform for asset, advising, brokerage, and wealth management stakeholders.
“WealthDesk’s vision is to create an internet-scale investment technology ecosystem by building the United Wealth Interface (UWI) for Asset and Wealth Management ecosystem on top of broking/transactional platforms in India. WealthDesk’s platform offerings will allow all stakeholders in this ecosystem to integrate with each other and push investment products innovation,” PhonePe said.
WealthDesk works with more than 50 partners from various industries. PhonePe anticipates the platform to grow as additional partners are integrated.
