Even as the stringent KYC (know your customer) norms by the Reserve Bank of India continues to be a struggle for digital wallet players, a few major players have started reworking their business models by focussing on the enterprise segment also.

For example, Pramod Saxena, Founder of Oxigen Wallet, said that the company had pivoted their business around merchants, institutions and enterprises nine months before the RBI came out with its master guidelines.

“We were apprehending these problems (KYC process) and hence, had shifted our focus to B2B. B2C is only 10 per cent of the total business now, besides B2B is more profitable as the huge cost of customer acquisition is eliminated from day one," Saxena said, adding that the full-KYC norms will further impact the retail consumer business due to the high costs involved. At present, the cost of KYC per user is in the range of ₹50-100, which means a company with 10 million users will end up spending ₹100 crore for getting KYCs done.

Therefore, even after five months and extension of deadline by the RBI, the wallet players are having a tough time to comply with the full-KYC norms. This has adversely impacted their consumer businesses by almost 80 per cent. As per the industry sources, the percentage of users who have complied with KYC norms are still in single digit per cent and this is forcing the companies to look for other revenue streams in a bid to retain their revenues.

Food wallets

Paytm Payments Bank, which owns and operates Paytm Wallet, has started focussing on its Food Wallet, which is a B2B corporate digital meal voucher programme launched last year.

Employers can instantly transfer money to food wallets of employees based anywhere in the country, while employees can pay for their food and beverages using their mobile on the go and keep a track of their payments on the app.

The company is expanding this service at a rapid rate with addition of other tax allowance offerings like gift wallet, fuel, communication wallet, the company said.

Paytm has already on-boarded about 500 companies across sectors in the country and is witnessing a 50 per cent month-on-month growth, it said in a statement recently.

Similarly, Mumbai-based The Mobile Wallet (TMW) plans to enter the online SME and retail lending space. The company, which started as a pure-play wallet, is also focusing on UPI (Unified Payment Interface) ecosystem and Bharat QR-enabled payment solutions to the merchants.

For this, the company had earlier this year, acquired a Trupay, a peer-to-peer and peer-to-merchant transactions platform offering pre-paid debit cards, powered by MasterCard, which works at ATMs and merchant establishments.

"We had been focusing on alternate business for quite sometime. We expect all the three segments of business contributing equally to the total revenues in the next six-eight months," Vinay Kalantri, Founder of TMW, told BusinessLine . For TMW, the digital wallet contributes about 80 per cent of the total business, however, with strict KYC norms, it is likely to come down in the coming months.

New Delhi-based MobiKwik has started focusing on B2B with the recent launch of its SaaS-based employee benefits and reimbursements programme for the corporates and expects to rake in ₹100 crore from this business in the first year itself.

"The B2B players have an inherent advantage over the B2C wallet players. While the wallet players are selected by the individuals in their personal capacity (being a consumer business), but players in the meal wallet/card and other reimbursements target the corporates, who then ensure that the benefits reach their employees without any hassles," said Subin Kumar Head – Marketing & Channels at Edenred India, a player on the Employee Benefits space with over 3,500 corporate tie-ups.

Several hiccups

Kumar further added that Edenred has been able to complete the full-KYC by 80 per cent, however, there are still several hiccups as many of its corporates have their employees in the remote location and many are facing challenges related to discrepancies in the Aadhaar data.

“While the companies who partner with us are playing a proactive role in informing the end users to opt for full KYC, we too are requesting our customers through SMS and e-mail to complete their KYC process," Kumar said.

According to Payment Council of India, an umbrella body for all PPIs in the country, of the total ₹12,000 crore transactions that are carried out on the mobile wallets monthly, about ₹4,000 crore comes from B2B businesses.

Besides, payment gateway PayU, which had two wallets Citrus and PayUMoney, has moved away from the wallet business early this year.

Its founder Amrish Rau has mentioned in various media, including BusinessLine , that the wallets will be soon dead with the advent of players like Google, WhatsApp that use UPI as an underlying technology for payments and transactions.

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