Comments
Digital payment app PhonePe, owned by ecommerce major Flipkart, aims to be the largest payment player in the country this year. PhonePe, which launched its app based on the unified payment interface (UPI) platform about two months back, has already got about 10 million users/downloads in that period and is betting big on the Government’s initiative to create a cashless economy by promoting different means of digital payment mechanisms.
No charge
Sameer Nigam, founder and CEO, PhonePe told Business Line that UPI-led payment mechanisms will make all other wallets redundant going forward as it allows an user to transfer money from his or her account immediately just the way it is transferred from one bank account to another. Also unlike other wallets, it doesn’t charge for money transfer from the wallet to the bank account. Other wallets like Paytm charge about 1-4 per cent from non-KYC users to transfer money or cash backs received in their wallet to their bank account. PhonePe charges a nominal processing fee of 50 paise from the banks. Unlike e-wallets, which needs to be refilled with money to make a transaction, UPI-enabled apps do away with this step by connecting payments directly with the bank accounts of a user and hence making it more convenient.
“The beauty of the app is that one doesn’t need to store any money in the wallet for making a seamless transaction. Plus we are also working on features that would allow an user to send money to a mobile phone number and this will be a game changer,” Nigam said adding that next in the pipeline is a feature with recurring and standing instructions to the user reminding him/her to pay their bills, fees and other payments.
Localisation
Nigam said that 2016 was all about reinventing the PhonePe app, which is available for android users at present and would be soon made available for iPhone users in a couple of weeks. In 2017, the company plans to focus on localisation of the app on basis of language. It has already added nine languages such as Hindi, Tamil, Malayalam, Gujarati, Kannada, Telugu among others and would be adding more in the coming months to tap into the smaller towns and cities.
Besides, the company is planning to fully integrated the app on the merchant sites so that users do not have to download the app but can still make a payment with PhonePe as an option from among other options like cards, net banking and wallets. The company has already added that feature to its parent company Flipkart and will be roping in another 30-40 large online merchants soon. The idea came in from several feedback that the company got which showed that customers do not want to store their money in the wallet.
Refunds
“Wallets is for petty changes (small amount of financial transactions). You don’t hold your entire household expenses in the wallet but take out amount as and when required from the bank. UPI will solve a lot of problems around this,” he said adding that the company is working on the merchant side to make reverse payments and refunds faster within just 10 seconds.
PhonePe, which is also a strategic partner with Yes Bank Ltd for its UPI app, was bought by Flipkart in late 2011.
While digital wallet providers such as Paytm, MobiKwik and Freecharge (owned by Snapdeal) have built large businesses in mobile recharge, cable and electricity bill payments, a majority of e-commerce transactions and offline transactions still happen via cash.
To be sure, it’s not yet clear how digital wallet providers plan to combat the threat from UPI-based payment start-ups. Plus, the likes of Paytm, Freecharge and MobiKwik have a huge head start over their UPI-based rivals. Paytm has secured a payments bank licence and the company is expected to integrate its wallet solution with its banking efforts.
Yet, given the number of banks that have signed up for UPI, the potential ease of use provided by the platform and the high number of use cases that UPI-based start-ups will offer, digital payments may finally be adopted in a big way in India.
“Choosing among payments solutions will come down to ease of use of the product. Our goal is to remove the need of going to your bank’s site or app and doing all your payments through PhonePe,” the first person cited above said.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.