येLo (pronounced as “Yelo”) has announced seed round funding from Matrix Partners India, Omidyar Network India, and Flourish. Existing investor Better Capital also participated in the round. येLo is a digital only mobile-first neobank focused on serving mass market consumers with a custom-made suite of financial products to satisfy life-needs such as remittance, healthcare, education, e-commerce, and day-to-day cash flow management.
“While India has progressed significantly in providing financial access to low-income consumers, customer engagement has lagged due to poor service levels or standardized offerings that simply do not meet people's real needs," explained Nilesh Agarwal, CEO and cofounder of 0.5Bn FinHealth, which owns the Neobank ‘येLo’. "As more people go online, we believe a customer-centric, digital bank is best suited to solve this problem with a better customer experience and at lower costs. By providing people with the right incentive structure and behavioral nudges, we can help get consumers ready to adopt digital financial services.”
Despite having close to 1 billion debit cards in India, the lack of usage in half of them represents a significant opportunity to drive financial wellness through higher engagement products. ‘येLo’ will provide an array of innovative financial products and services aimed at improving financial outcomes to Indians in the segment dubbed as the "Next Half Billion". The idea is to personalize offerings to customer-profiles, such as manufacturing and construction workers, security guards, truck drivers, farmers, and gig economy workers, among others, to provide a wide-range of services, from banking and payments, to credit and insurance.
“The power of येLo lies in personalizing and curating relevant financial services offerings, that address people's real needs and risks, in affordable packages priced under INR 50," says Abhishek Challa, co-founder of 0.5Bn FinHealth.
In order to deliver on this promise, the team has already entered into partnerships with best-in-class financial services providers such as ICICI and Federal Bank, with others in the pipeline. Funds raised in this round will be used to build a local language-based experience—a must-have in order to reach low-income consumers in the country—and to expand the current team to 100 people in the next 12-18 months.
"Creating financial habits that solve for the daily needs of aspiring India using reliable and affordable financial services is key to helping create a meaningful life." says Anuradha Ramachandran, Director, Omidyar Network India. "We also are confident in the knowledge and experience of the team—while we worked together, Nilesh helped to expand the knowledge around the barriers holding back the uptake of digital financial services in the country". Ramachandran also led the investment for Flourish Ventures, a partner organization of Omidyar Network India.
“Nilesh and Abhishek’s vision to build for “Bharat” by digitizing banking to empower all strata of Indian society is a proposition we strongly believe in. Their suite of products specifically designed to meet the requirements of the mass market consumer in India is the need of the hour to bring financial inclusion to the “Digital India” vision. We are excited and privileged to be a part of this journey along with Omidyar Network” says Avnish Bajaj, Founder & Managing Director, Matrix Partners India.
0.5Bn FinHealth was founded earlier this year by friends and Indian
School of Business classmates Nilesh Agarwal and Abhishek Challa. 0.5Bn FinHealth is passionate
about the financial health of the mass market consumer, the ‘Next Half Billion’ people who will be
coming online in the next five years. They provide customers an optimum basket of financial products
that are meant to meet their unique needs, unlike the standard offerings from traditional financial
service providers. Their personalised neobanking service, ‘येLo’, provides a range of innovative
products and services to address immediate short-term needs such as day-to-day cashflow management
as well as long-term needs such as future medical shocks. More information can be found at http://www.point5bn.com
Matrix Partners India is an investment firm with approximately $1
billion under management. Founded in 2006, the firm invests in companies targeting the Indian
consumer and enterprise market at the seed, early and early growth stages. Matrix India has invested
in several market leading companies such as Ola (local transportation), Quikr (online classifieds), Practo (digital health platform), Country Delight (a
direct to home, mass premium fresh milk brand), Dailyhunt (mobile local language platform), DailyNinja (subscription
based milk and grocery delivery app), Treebo (digital hotel chain), Limeroad (social e-commerce platform), Mswipe (mobile POS), Five Star Business Finance (SME lending), OfBusiness (credit led B2B marketplace), Stanza Living (tech enabled student housing platform),
personalized one stop solution for all Govt. job competitive exams), Awaaz
(video news and entertainment platform focused on regional and hyperlocal content), Avail Finance (online lending platform), LiquiLoans (peer to
peer lending platform), Ola
Electric Mobility (multimodal electric vehicle platform), Vogo (scooter sharing) and Cloudnine Hospitals (leading chain of maternity
hospitals), among others. Matrix India has advisory offices in Bangalore,
Delhi and Mumbai. Matrix Partners has a global network of funds investing in the US, China and
India, with approximately $5 billion under management. Further information is available at www.matrixpartners.in
Omidyar Network India invests in bold entrepreneurs who help create
a meaningful life for every Indian, especially the hundreds of millions of Indians in low-income and
lower-middle-income populations, ranging from the poorest among us to the existing middle class. To
drive empowerment and social impact at scale, we work with entrepreneurs in the private, nonprofit
and public sectors, who are tackling India’s hardest and most chronic problems. We make equity
investments in early stage enterprises and provide grants to nonprofits in the areas of Digital
Identity, Education, Emerging Tech, Financial Inclusion, Governance & Citizen Engagement, and
Property Rights. Omidyar Network India is part of The Omidyar Group, a diverse collection of
companies, organizations and initiatives, supported by philanthropists Pam and Pierre Omidyar,
founder of eBay.
Flourish is an evergreen, early-stage venture fund investing
globally in entrepreneurs whose innovations help people achieve financial health and prosperity.
Spun out of Omidyar Network in 2019 with an existing portfolio of $200 million, Flourish received a
new commitment of $300 million from Pam and Pierre Omidyar, the founder of eBay. Flourish invests in
a number of themes in fintech, insurtech, regtech and other technologies, as well as supports
nonprofit organizations, that empower people and help foster a fair, more inclusive economy.
Flourish is managed by a global team with offices in Silicon Valley, Washington DC, London, and
India. For more information visit www.flourishventures.com or join our
community through Twitter, LinkedIn, Instagram, and Medium.
Better Capital is a venture firm that invests in category-defining
businesses at the earliest stages, with a primary focus on India. We partner with mission-oriented
founders and invest with deep conviction based on our global experience in building ideas from the
ground up. Within a short period of time, Better Capital has assembled a stellar portfolio of
investments including Rupeek, Open, Bon, Shop Kirana, Textbook, Yulu, Clarisights, Gramophone, Jai
Kisan, LeanAgri, PaperVC & many other notable companies. Learn more about Better Capital
at www.betterlabs.net and
follow our founder Vaibhav Domkundwar on LinkedIn here www.linkedin.com/in/better.