Dream11 Enters Fintech Space, Takes on PhonePe and Google Pay with UPI Payments App Launch
- ByStartupStory | April 3, 2023
Dream Sports, the parent company of fantasy gaming unicorn Dream11, has entered the fintech market by launching its mobile payments app, DreamX. The app is currently in beta and is only available to a select group of users as part of the early access program. With support from the Unified Payments Interface (UPI) and Bharat Bill Payment System (BBPS), DreamX enables users to transfer funds, pay utility bills, and make online purchases.
Despite being in beta, Dream Sports has made its mobile payments app, DreamX, available to users via the Google Play Store and Apple’s App Store. The company, which already provides payment solutions for online merchants, plans to use DreamX to offer payment services to all its customers, including the large user base of almost 160 million active users of Dream11 as of December 2022. Dream Sports aims to capitalize on Dream11’s popularity to drive its fintech business. Additionally, the launch of DreamX may be an attempt to provide Dream11 users with more ways to use their winnings.
In collaboration with Pine Labs, a payment solution provider with a prepaid payment instrument (PPI) license, Dream Sports has launched its fintech app, DreamX. The app promises to provide rewards and display offers from Dream11’s other sister companies. Dream Sports is an umbrella company that includes various platforms such as Fancode, a sports content and commerce platform, DreamSetGo, a sports experiences platform, and Rario, a cricket-focused digital collectibles startup. With this launch, Dream Sports enters the competitive fintech market and could compete with industry giants such as PhonePe and Google Pay. Additionally, Dream Sports may attempt to directly serve Dream11 customers by eliminating intermediary payment platforms.
Dream Sports’ foray into the fintech industry holds particular significance, given the recent announcement by the National Payments Council of India (NPCI) that merchants will be charged an interchange fee of 1.1% for UPI transactions above INR 2,000 made via prepaid payment instruments (PPIs). This development coincides with Dream Sports’ efforts to enhance its position in the fantasy gaming sector and expand its offerings. Despite the company’s intention to increase investments in sports and gaming startups, mounting competition has impacted its margins to some degree.
Dream11’s net profit for FY22 decreased by over 50% to INR 141.97 Cr due to increased expenses, although revenue rose significantly by 1.5 times YoY to INR 3,840.7 Cr. Dream11 competes with other gaming unicorns such as Games24X7 and Mobile Premier League in the fantasy gaming space, which poses regulatory challenges. However, Dream11 is well-positioned to benefit from the growth of the Indian gaming industry, which is projected to reach $8.6 Bn by FY27.
Moreover, the homegrown fintech market presents a $2.1 Tn opportunity for startups by 2030. Dream Sports launched its payments platform, DreamX, ahead of the 16th edition of the Indian Premier League, which typically sees a surge in active and new users on the Dream11 platform during the cricket season. Dream Sports aims to capitalize on Dream11’s popularity to promote its payments app.
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