MobiKwik has launched a new service that will enable customers to make credit card bill payments on its application. At the moment, however, users can only make payments for Visa credit cards, irrespective of the issuing bank, it said in a press release. MobiKwik will be extending this service to other credit card brands in the near future, the release added.
The company expects the service to significantly boost its revenues given the ‘burgeoning’ credit card market in the country. In April 2018, there were a total of 37.78 million credit cards operational in the country, according to data from the Reserve Bank of India. While Visa claims to be the market leader in issuances of credit cards in India, it remains unclear on how many such cards the financial firm has operational in the country at the moment.
Upasana Taku, co-founder and Director at MobiKwik said, “Credit card payments offers a huge opportunity and we are targeting capturing a market share of 3-5% of the credit card spend market, which translates to ₹1,200- 2,000-crore opportunity, by the end of the current fiscal year.”
Going forward, India is expected to have an additional over 40 million credits cards in the country over the next four years, while the Indian Credit Card industry is poised to grow at a whopping 25% Year on Year, as per RBI, the release said.
While the ability to pay credit card bills certainly strengthens MobiKwik’s boutique of services, it will be interesting to see if how the feature will perform in the coming months. MobiKwik’s chief rivals are already offering either a similar service or one with limited functionality. Paytm offers credit card bill payments, it does only for cards issued by either IndusInd Bank or Kotak Mahindra bank, while PhonePe also lets users pay Visa credit card bills.
Competition in the payments ecosystem
Although the payments system was already extremely competitive in India, things have intensified in the last few months. India’s largest payments company, Paytm has raised an undisclosed amount from Berkshire Hathaway this week. The company also partnered with Alibaba to launch its artificial intelligence (AI) cloud computing platform Paytm AI Cloud in India.
Google announced that it would rebrand its UPI payment app Tez to Google Pay, bundled with additional features, while PhonePe raised Rs 451.66 crore recently. The Flipkart backed service has been using its funding to launch a variety of services since the turn of the year and consequently, claims to have become the largest UPI-based payments player in the country with a 40% share of the market in July.
This is apart from the countless other payment apps that already exist, and a bunch of others that are likely to launch soon, including WhatsApp, India Post Payments Bank and Reliance Jio.