The eBay-backed online commerce company Snapdeal has completed what it is calling one of the biggest acquisitions in the history of the internet in India.
The online marketplace, which has received millions in investment from eBay, announced today a deal for online transaction service FreeCharge, which rewards users with coupons when they top up their phone credit or pay utility bills.
Snapdeal has stated that FreeCharge will continue as an independent platform and despite the integration between the two companies, “all aspects of FreeCharge’s shopping experience will remain intact”.
Freecharge recently raised $80 million in Series-C funding, including Sequoia Capital among its investors. A price for the integration with Snapdeal has not been disclosed.
Over half of FreeCharge’s clients have payment cards connected to their accounts, allowing easy conversion into Snapdeal customers.
Furthermore, a considerable 85% of FreeCharge’s business comes from mobile devices - another enticing aspect of the transaction service for Snapdeal as many of India’s online population access the internet via a mobile device.
Sales of smartphones in India doubled between 2013 and 2014, jumping from 156 million to 364 million, with growth expected to continue, according to research data by Mediacell.
“FreeCharge is at the forefront of the mobile commerce revolution which is taking place in India right now,” says Kunal Shah, co-founder & CEO of the online transaction outfit.
“The partnership with Snapdeal comes at the right time, I foresee this as an opportunity to accelerate our road map in India and reach out to millions of users across the country.”
Snapdeal, which started as a daily deals platform inspired by Groupon.com and exanded into an online marketplace, is up against Bangalore based Flipkart and internet giant Amazon, which has pledged $2 billion to expand its business in India.
In order to compete, Snapdeal has also recently acquired loan service Rupeepower, luxury goods marketplace Exclusively and recommendations platform Wishpicker.