Fintech app Jar to go beyond gold, offer securities via new subsidiary

The Bengaluru-based micro gold saving app will obtain the necessary licences to offer exchange traded funds and sovereign gold bonds.

Micro gold saving and investment app Jar plans to go beyond gold and offer securities such as exchange traded funds (ETFs) and sovereign gold bonds (SGBs) through its platform. 

According to a Registrar of Companies (ROC) filing assessed by YourStory, the company has received the board’s approval to form a subsidiary under the name 'Safejar Advisors Private Limited' for this purpose. The name of the subsidiary is subject to the approval of ROC.

As per the regulation of the Securities and Exchange Board of India, a company carrying on registered investment advisor activity cannot engage in distribution of unregulated commodities such as digital gold. Therefore, the company has proposed to form a wholly owned subsidiary to obtain the licences for expansion, according to the filing.

In line with its business diversification plan, Jar will expand its offerings to cover ETFs, SGBs and other securities through its platform.

Founded by Nishchay AG and Misbah Ashraf, the Bengaluru-based app enables users to make daily savings by taking spare change from their online transactions and automatically investing it in digital gold. The investments in digital gold are backed by physical gold of the same amount, and investors can choose to withdraw that much gold or liquidate it at any time. 

At present, the year-old-app claims to have a registered user base of over 4.7 million, processing over 100 transactions per minute on its platform. 

Jar competes directly with apps such as Gullak and Spenny, besides other saving and investment apps, such as Appreciate, which operate in the spare change model but invest in mutual funds. 

Jar seems to follow the business model of international startups such as Acorns, Stash, and Clink. These apps work on the spare change model and then recommend an investment plan for users based on goals, employment, and income. Acorns offers five diversified portfolios of ETFs and is now inching its way towards crypto. 

Building a tranche for new offerings 

In May 2022, Jar was reportedly in talks to close a new funding round (Series B) to the tune of $50 million, led by its existing investor Tiger Global, along with the participation of Rocketship, Third Prime, and Stonks. 

Entracker was first to come out with the information. 

The new round of funding would come just a few months after the startup raised $32 million in a Series A round led by Tiger, in February 2022., Third Prime, Stonks, Force Ventures, Arkam Ventures, and WEH also participated in the round. The Series A round followed a $4.5-million seed funding in August 2021.

Responding to YourStory’s queries, Jar's co-founder Nischay said that it’s too early to comment but he confirmed the company's foray into other investment tools in the near future. 

Edited by Swetha Kannan


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