Two people familiar with the situation informed YourStory that ride-hailing company Rapido is expanding its operations outside its core mobility business by establishing a distinct subsidiary to join the financial sector.
For the new division, which is anticipated to function independently of its current business lines, the corporation has started internal preparations. According to the two individuals, Rapido is looking into loans and related financial services, though the specifics are still being kept under wraps.
This would be Rapido’s second significant diversification, following its eagerly awaited debut into the crowded food delivery industry. The WestBridge Capital-backed business has already started hiring and forming alliances with eateries for its brand-new, commission-free meal delivery platform.
By aggressively entering the three-wheeler and taxi markets after the epidemic, Bengaluru-based Rapido has surpassed Ola and Uber to become the top ride-hailing platform by volume during the past year. Its zero-commission strategy allowed it to dominate lower-ticket markets and draw in drivers and customers who are price conscious.
“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 the second person aware of the plan.
Prosus and WestBridge secured $230 million in capital last year, giving Rapido the cash on hand to go into additional industries. According to a former executive, internal teams had previously looked at peer-to-peer lending, insurance, retirement investments, and car upgrade programs for users of Rapido’s network.
Additionally, the business has been testing three-wheeler EV leasing, which might be included into the financial division. According to the former Rapido executive, the firm will probably target its own riders first before focusing on gig workers across platforms, even if one of the two people with knowledge of the situation said the company would continue to be mobility-adjacent.
The action was taken in the face of new regulatory obstacles that might seriously harm the company’s successful bike-taxi business. The Karnataka High Court ruled last week that the state’s bike-taxi services must be suspended. In addition to being Bengaluru’s home state, Karnataka is also its biggest market. Similar legal setbacks have been experienced by the company in Delhi and Maharashtra.
“Rapido needs diversification. The recent Karnataka HC order shows how vulnerable the core business can be,” said one of the people quoted above. “Fintech and food delivery are bets to build resilience.”
Rapido is hoping that it can leverage the lessons it learnt from ride-hailing to dominate the Indian food delivery business, according to a report published on Monday by The CapTable.
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