Empowering Blue-Collar Workers in India

Why We Invested in 0.5Bn FinHealth

Efforts in the areas of digitization and financial inclusion have resulted in more than 500 million internet users, 300 million smartphone owners, and bank accounts covering 80 percent of Indian adults. However, adoption of formal financial services is still low and a vast majority of households do not have access to formal credit. According to a World Bank report released in 2018, 48 percent of the country’s bank accounts are inactive. Similarly, an IMF report from December 2017 states that only 13 percent of Indian adults borrow through formal channels. As of March of this year, only 47 million credit cards were in use.

Banks and startups are working to improve penetration in the high- and middle-income segment, but there is a distinct lack of focus on low-income customers like Jagdish, who typically earn less than Rs 25,000 (about $350) monthly. The processes, products, or services offered by the existing players simply do not cater to the needs of this segment.

So, while Jagdish has a bank account in his neighborhood bank, he ends up withdrawing his entire monthly salary from an ATM in order to pay bills or buy groceries. When faced with an emergency, he usually relies on the informal network of local lenders to borrow money, because he doesn’t qualify for a credit card or other loan. And when he needs to remit funds to his family in Rajasthan, he reverts to the local banking correspondent agent, paying high service fees.

Exclusion from the formal financial system — and the high cost of transacting through informal services — have contributed to limit Jagdish’s ability to save. After two decades of continuous hard work, he has only been able to put together a small rainy-day fund in gold.

Enter 0.5Bn FinHealth, a digital banking platform designed to meet the needs of blue-collar workers, helping to on-ramp them into the formal financial segment. The company leverages partnerships with corporates and SMEs to aggregate customers and provide them personalized financial product offerings. Through tie-ups with banks and other financial services companies, the 0.5Bn is offering the entire suite of financial products and services including a salary account, remittance, credit, insurance, and more, in an affordable, multi-language, and easy-to-use app backed by a friendly customer support.

The idea was hatched by Nilesh Agarwal, CEO and founder, during his time with the Financial Inclusion team at Omidyar Network. As an investment professional, he was often frustrated with the inability of incumbents and startups to serve the blue-collar segment, a key part of India’s population. So, he finally decided to take the plunge. We are thrilled to see this venture come to life, practically incubated in our office in Bangalore.

Having worked with Nilesh and met his cofounders, we believe in the company’s mission-driven approach and their focus on addressing current gaps in the financial services industry. We look forward to a future where the success of 0.5Bn draws more players to focus on low-income, underserved populations, providing them with access to meaningful, affordable formal financial services and in turn, helping them improve their financial health.


Flourish is an evergreen, early-stage venture fund investing globally in entrepreneurs whose innovations help people achieve financial health and prosperity. Spun out of Omidyar Network in 2019 with an existing portfolio of $200 million, Flourish received a new commitment of $300 million from Pam and Pierre Omidyar, the founder of eBay. Flourish invests in a number of themes in fintech, insurtech, regtech and other technologies, as well as supports nonprofit organizations, that empower people and help foster a fair, more inclusive economy. Flourish is managed by a global team with offices in Silicon Valley, Washington DC, London, and India. For more information visit www.flourishventures.comor join our community through Twitter, LinkedIn, Instagram, and Medium.

Anuradha Ramachandran

Written by

A decade in venture capital. Director Investments @ Omidyar Network. Focus: Financial services, MSME business models. Like Gandhi and Calvin & Hobbes equally.

Flourish Perspectives

Flourish, a venture firm investing in entrepreneurs whose innovations help people achieve financial health and prosperity, shares news, trends, and insights from the Fintech space.

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