Introduction-: Freecharge.In (Company) a subsidiary of Accelyst Solutions Pvt. Ltd commenced its business operations on 15th August 2010.

The Company has a unique business model wherein on a prepaid mobile talk time recharge of amount starting from Rs 10 to Rs 1000 the users get discount coupons of equivalent amount of various brands. Freecharge is conceptualized strategic marketing company which has tie-ups with Indias top retail and telecom companies. Freecharge is seed funded by Tandon Group, members of the Mumbai Angels. Freecharge has applied for a patent on their business model, the status of which is currently pending. Freecharge works on the model of getting into MOUs with leading chains like McDonalds, Barista, PVR, Shoppers Stop, ibibo and many more where, upon recharging, user gets a free coupon equal to the amount recharged; which can be redeemed in the respective retail outlets. This attracts many prepaid mobile users, as a perception of free-credit transfer is created in the minds of consumers. SWOT Analysis of Freecharge.in Strengths: Low investment since no major capital costs High Awareness through social networking sites (1 lakh+ face book users) Has customer database of over 1 million users Potential of providing analytics as solutions to many companies Tie-ups with all major telecom companies Tie ups with various apparel, entertainment and hospitality chains Easy and only 3-step process of customer transaction Complete value for money for consumers Since, consumers get coupons of entire recharge free, they consider their recharge to be free which attracts more eyeballs Without major advertising spends, Freecharge.in still manages to achieve 20,000 couriers a day Weakness: Limited Target group Only targets prepaid account users Credit and debit card users only Requires internet connectivity Risk of theft or loss during transit of coupons Logistic Costs of physical coupon transfer is high. Relies on external source for physical coupon delivery

Opportunities Internet displays a huge penetration potential in the Indian market Digitalisation of various mediums of communication and transaction High usage of data on mobile phones shows increased internet usage on mobile phones as well as high propensity to spend which results in large and / or frequent recharges Indian mobile penetration currently around 50% expected to reach 70% by 2015. More than 95% of these customers are prepaid users. With low ARPUs (Avg. revenue Per User), high MOUs (Minutes of Usage) & falling tariffs, the propensity to spend is ever increasing and thus huge potential exists to tap online recharge market Increased secure internet transactions could boost business further Mobile Wallet relatively new & untried concept in Indian markets, with huge upside Freecharge could consider sending mobile coupons rather than physical coupons This would minimise operational costs and reduce delivery delays Emerging retail chains which could be targeted for tie-ups Threats: Low entry barrier to business could increase future competition Since, many competitors could get into similar agreements without major barriers, threat of new entrant is high. Various forms of recharge available to consumers grab market share Traditional forms of recharge such as purchasing physical recharge cards, poses a great challenge to Freecharge Lower vigilance of cyber-crime in India This leads to consumers being hesitant to use their credit or debit cards online. Consumer mind-set regarding online-payment frauds. Existing distribution channels for recharge. Difficult to penetrate into the set channels of reaching consumers. Cartelization of mobile operators could hamper business severely

Potential Revenue streams Direct Revenue Commissions from telecom companies Advantage of buying of pins in bulk quantities This helps Freecharge get bulk discounts and better margins in transactions Indirect Revenue Commissions from retailers, chain restaurants and various franchises Since, Freecharge provides additional business to the tied-up franchises, we could create a portal for various brands to promote and advertise on the site Using the customer data base of over 1 million users (logistics & analytical purpose) Data of face book or telecom company users could be used but not sold for advertisement purpose (more than 1 lakhs face book users) Making available advertising space for companies wanting to promote on the website Logical Deals and Possible Extensions: Post-paid Bill payment tie-ups could be ventured into As per TRAI (press release-55/2011), the mobile industry displays a growth rate of more than 32%. 97% of the 885 million active mobile users are prepaid mobile users. However, 30-40% of the revenues are accounted by the post-paid users. By tapping these 3% users, Freecharge could look at a substantial share in the value chain in this booming telecom sector. However, terms and conditions would need to be altered for this payment Other domestic Bill Payment could also be paid with similar terms and conditions Data Card Usage could be tied up with the DTH facility Internet card plans could be ventured to diversify business This business could piggyback on the already existing DTH business by recharging discounted credit for televisions Movie Ticket booking and Airline Booking Insurance Premium Payments Forward Integration by getting into courier services Online shopping portals Here, we could integrate the rewards offered to consumers and make it usable on the online shopping websites. This would create a symbiotic business for the the recharge website as well as the online shopping portal. Creation of mobile apps to carry out transactions in case of no- computer availability or penetration (example: PayPal, M-Pesa, safaricom)

Analysis of Physical Coupons Advantages: Tangible benefit to consumers Coupons directly by the Tie-up Low cost for attracting many consumers Delivery costs not very high

Disadvantages: Major driver of logistic costs Increases operational costs Increases time lag between transaction and actual delivery Difficult to maintain and preserve Chances of loss by consumers is high Chances of thefts or misplacement during travel is high Leads to reliance of delivery on third-party High investment cost for designing of physical coupons

Since disadvantages outweigh the advantages, a probable solution would be sending of coupons through mobiles. At the time of recharge, as the payment is confirmed, there would be an instant SMS that would be delivered to the customer consisting of the unique coupon codes redeemable at respective outlets. Three copies of this code will be maintained. One with the customer who receives the SMS. Second with Freecharge.in in order to track the date and period after which a coupon is redeemed. This would add as an additional source of information in the analytics line of business The third with the respective outlet or chain. As soon as the coupon is being redeemed, the unique code will be matched with the database of outlet. Correct identification will instantly update the status of the code in the database of Freecharge, ensuring effective monitoring.

In this way, the following advantages are achieved: Operational costs reduced Logistic requirements minimised Effective monitoring of coupons Green initiative by the company Helps in CSR as well as in acquiring various certifications like the ISO Easy transactions for tied-up companies Consumers generally complaint that they do not receive the delivery of the coupons in the prescribed time limits. Often, consumers do not receive the coupons at all, which triggers theft or misuse of coupons in the delivery process. The logical solution as mentioned earlier would be to establish a courier service that would ensure timely delivery of coupons with appropriate and strict supervision. However, this still involves some levels of transaction costs which could be minimized to a great extent by the use of m-coupons. Conclusion: The online prepaid recharge business currently contributes to less than 1% of the total prepaid recharge which ensures a huge potential to tap the market. The working model of Freecharge seems to be a sure win-win for mobile operators, retailers and the users.