Ola, Uber rival Rapido plans to launch new subsidiary for fintech operations: Report

Rapido, the Bengaluru-based ride-hailing unicorn previously reported to be entering the saturated food delivery space, is now turning its attention to the fintech space.

The startup has begun preparations to launch a separate subsidiary focused on lending and other fintech products, according to a report by YourStory.

The new unit will operate independently from Rapido's core mobility business, signalling the company's intent to diversify amid increasing competition and regulatory headwinds.

Exploring lending and financial services

Rapido's upcoming fintech arm is expected to concentrate on lending and related areas within financial services. While plans have not yet been finalized, Rapido has already started laying the groundwork for the new venture.

It has previously explored products like insurance, retirement investments, peer-to-peer lending, and vehicle upgrade programs for its riders. Rapido has also been testing three-wheeler electric vehicle leasing, which could be folded into the fintech unit.

Initially, the fintech unit will focus on Rapido’s existing network of riders, but expansion to broader gig worker segments is likely. The subsidiary may stay close to the core mobility business through offerings such as vehicle financing, though the company may widen its scope based on market response, the report said.

Venturing beyond mobility

In March, ET reported that Rapido is in early talks with restaurant partners to enter the food delivery space, aiming to disrupt the dominance of Swiggy and Zomato. The startup is reportedly working on a zero-commission marketplace model, which could reshape industry commission structures. It has reportedly initiated partnerships with restaurants to build this new platform.

The company raised $230 million last year from investors including Prosus and WestBridge and has since been aggressively looking to expand into new verticals to reduce dependence on its ride-hailing business.

Over the past year, Rapido has also emerged as one of the largest ride-hailing platforms by volume. Its strategy of offering competitive prices in the three-wheeler and cab segments, along with its lower fares for users and steady earnings for drivers, helped it gain market share over established players.

Now that the ride-hailing segment has hit a "steady state," the company's founders are focusing on additional initiatives such as food delivery and fintech, the report noted.

Rapido's urgency to diversify is partly driven by new regulatory hurdles, including a recent Karnataka High Court order suspending bike-taxi services in the state. Karnataka, which includes Bengaluru, is Rapido's largest market and a critical hub for its operations.