Muvin, a neobanking startup targeting the youth, has reportedly shuttered its operations following the Reserve Bank of India's (RBI) order last year, which prohibited the use of UPI (Unified Payments Interface) in co-branding arrangements.
A notification on the Muvin app informed users, stating, "muvin card program has been closed. Any available balance is being migrated to issuer Livquik app. The migration is expected to be finished by 1st Feb, and we would notify the next steps to access your balance. Thank you for the support, and we regret that muvin is unable to support your journey towards financial literacy."
Muvin has not yet responded to inquiries regarding the shutdown.
Co-founded by Vineet Gupta and Mukund Rao, Muvin offered neobanking services to students, including customer acquisition, KYC (Know Your Customer) processes, and prepaid cards. These prepaid cards enabled payments through Muvin's prepaid payment instrument (PPI) issuer. Muvin had partnered with Livquick, a registered non-bank PPI issuer, to provide co-branded prepaid cards to its customers.
In 2022, the startup secured $3 million in its pre-Series A funding round, led by WaterBridge Ventures, following a $1 million seed funding round.
The RBI's decision to disallow UPI in co-branding arrangements has had an impact on 15-20 fintech players, as reported earlier. The central bank has taken various measures in recent years to regulate the fintech sector better, including issuing digital lending guidelines, penalizing players for violating PPI (Prepaid Payment Instruments) norms, and prohibiting non-bank PPIs from being loaded with credit lines.
Several significant players, including Slice, Jupiter, Unicards, and OneCard, have been affected by these measures, which disrupted their business operations. Additionally, the RBI's cancellation of the payment aggregator license disrupted operations at Instamojo and other fintech companies, as previously reported.