Freecharge provides prepaid mobile recharge services to consumers. It launched its app in February 2014 and gets 85% of its traffic from mobile. Cumulatively, app downloads are 9 million.
Freecharge has a user base of 20m and average number of transactions per day is 400k. Average value per transaction is Rs125. Key revenue streams include recharge commission from telcos, paid coupons from merchants, and in some cases it charges for directing traffic to merchant partners. Freecharge generates a few hundred thousand leads every month.
Telcos pay, on average, a commission of 2.5% on recharges, and Freecharge pays a payment gateway charge of 1.5%. Currently, two-thirds of traffic is acquired, and the remaining one-third is organic.
The overall online recharge market is only 2-3% and can go up to 40% over the next few years. Currently, the market leader in the recharge market is Paytm, followed by Freecharge. MobiKwik would be third, followed by a long tail of several competitors. A large number of transactions in the Freecharge platform are paid by cards, and debit cards form a large portion of cards.
