Tribe & Arkam: Savings App for India | Financial Inclusion

Financial Investment Accessibility in India

Despite widespread bank account access, a remarkably small percentage of the Indian population actively participates in financial investments.

Currently, less than 30 million individuals in India invest in instruments like mutual funds or stocks. Recent efforts by several startups to simplify investing, particularly for millennials, haven’t significantly altered this statistic.

Introducing Jar: A New Approach to Savings

An Indian startup, Jar, believes it has identified a solution to this challenge and is demonstrating promising initial results.

Founded earlier this year by Nishchay AG, previously a director at mobility startup Bounce, and Misbah Ashraf, co-founder of Marsplay (acquired by Foxy), Jar aims to make saving accessible to everyone.

The company’s Android application, launched three months ago, allows users to begin their savings journey with as little as 1 Indian rupee.

How Jar Works: Simple and Automated Investing

Jar offers multiple investment options and facilitates quick onboarding for users. The app integrates with Paytm (with PhonePe support planned) to establish recurring payments.

Users can configure daily investments ranging from 1 to 500 Indian rupees. This is the first application to leverage the recurring payment functionality of UPI 2.0.

Furthermore, Jar can analyze users’ text messages and automatically save small amounts based on their spending. For example, a 31-rupee transaction might be rounded up to 40, saving 9 rupees.

Users also have the option to manually invest any desired amount through the app.

Investing in Digital Gold

Funds saved through Jar are then invested in digital gold.

This strategy is based on the strong cultural affinity for gold within the South Asian market.

The Cultural Significance of Gold in India

India possesses a deep-rooted tradition of gold ownership. From rural communities to urban professionals, gold is widely held and prominently displayed during celebrations like weddings.

It is estimated that Indian households collectively possess over 25,000 tons of gold, representing approximately half of the nation’s nominal GDP.

Consequently, India ranks among the world’s largest importers of this precious metal due to consistently high demand.

Building Trust Through Familiarity

“When considering how to bring the next 500 million people into institutional savings and investments, it’s crucial to educate them about various investment options,” explains Nishchay.

“However, we aim to initially provide them with an asset they already trust – gold,” he adds. The startup intends to expand its investment offerings in the future.

The Genesis of Jar

The founders, Nishchay and Misbah, first connected while exploring potential synergies between MarsPlay and Bounce.

Their conversations continued, and last year they realized a shared lack of understanding regarding investments.

“This realization sparked the core idea,” says Misbah, recalling his upbringing. “I grew up in Bihar Sharif, and witnessed my family struggle with debt due to poor financial planning and a lack of savings.”

“We both understand the financial realities faced by typical middle-class families. Individuals from these backgrounds often have limited past resources but possess boundless aspirations. Consequently, earnings are often immediately spent,” notes Nishchay.

“The market requires products that facilitate a starting point for savings,” he emphasizes.

Early Traction and Investment

This concept, mirroring the approaches of Acorn and Stash in the U.S. market, is gaining momentum. The Jar app has already surpassed 500,000 downloads.

This progress has attracted the attention of investors.

Recent Funding Round

Jar recently announced a $4.5 million funding round led by Arkam Ventures, with participation from Tribe Capital, WEH Ventures, and angel investors including Kunal Shah (CRED), Shaan Puri (formerly Twitch), Ali Moiz (Stonks), Howard Lindzon (Social Leverage), Vivekananda Hallekere (Bounce), Alvin Tse (Xiaomi), and Kunal Khattar (AdvantEdge).

“Jar’s vision aligns with our belief that millennials’ financial well-being can be enhanced through innovative product design. We are impressed by their ability to influence user behavior at scale within the attractive financial planning and investment market,” stated Rahul Chandra, MD at Arkam Ventures.

Future Growth and Expansion

Nishchay reports that transactions and Assets Under Management (AUM) on the Jar app are increasing by 350% monthly.

The startup plans to broaden its product range in the near future.