After food delivery, Rapido eyes fintech sector with lending-focused subsidiary
What's the story
Bengaluru-based ride-hailing giant Rapido is venturing into the fintech space by creating a separate subsidiary, according to YourStory.
The move comes as another step in its diversification journey beyond its core mobility business.
The new unit will operate independently, with a focus on lending and other financial services.
"They are looking at a fintech subsidiary, but nothing has been finalized yet," an insider familiar with the plans told YourStory.
New venture
Rapido's expansion into food delivery
Rapido's entry into fintech comes as it also ventures into the cut-throat food delivery space.
The WestBridge Capital-backed company has already started hiring employees and partnering with restaurants for its zero-commission food delivery platform.
"Now that ride-hailing has reached a certain steady state, the founders are putting more focus on newer initiatives like food delivery and fintech," said another insider familiar with Rapido's plans.
Expansion
Growth and future plans
Having raised $230 million last year from Prosus and WestBridge, Rapido is in a good position to explore new avenues.
The company has previously looked into insurance, retirement investments, peer-to-peer lending, and vehicle upgrade programs for riders on its platform.
It has also been testing three-wheeler EV leasing, which could be integrated into the fintech division.
Business hurdles
Regulatory challenges and need for diversification
Rapido's move to diversify comes at a time when new regulatory challenges could affect its bike-taxi service.
The Karnataka High Court recently ordered the suspension of bike-taxi services in the state, which is not just home to Bengaluru but also its biggest market.
"Rapido needs diversification. The recent Karnataka HC order shows how vulnerable the core business can be," said one insider.