Editor’s Update: Several senior payments industry sources have contested Paytm’s claims privately to MediaNama, but none of them want to come on record about it. Following this, MediaNama also contacted NPCI, and they’ve declined to comment on company specific information. We would advise readers to exercise caution when taking these numbers into consideration.
Earlier: Paytm clams to have processed 70 million UPI based merchant transactions out of the total 120 million transactions in the country in May 2019, reports Mint. The digital payments firm said that it was the “leader” in merchant-based UP transactions with 60% of the total market share, and seeing a 10% monthly growth rate in this segment. The company also claimed that 12 million offline merchants accepted payments via Paytm BHIM UPI. Paytm’s senior VP Deepak Abbott told ET that the firm is planning to invest around Rs 200 crore to expand its retail merchant base, adding that Paytm plans to reach 25 million merchants from its current 10 million merchants by the end of 2019.
This development means that Paytm’s competitors that include the likes of PhonePe, Mobikwik, Google Pay, PayPal and Razorpay among others have to fight for a tiny share of the pie. Here’s what some of them have been up to for establishing a foothold in UPI-based merchant payments:
Paytm vs competitors
Flipkart owned PhonePe didn’t share its numbers for recorded merchant payments, but told ET that merchant payments had increased multiple times since the beginning of this year. Yuvraj Singh Shekhawat, head of offline business growth at PhonePe said more than 5 million merchants spread across 150 cities have been using PhonePe’s service. Some of the initiatives that PhonePe has taken up to drive merchant payments are:
- PhonePe customers can book rooms on Oyo from the PhonePe app, after paying a token amount of Rs 100 and paying the balance at the hotel. PhonePe already has similar tie-ups with other merchants like redBus, Goibibo, Ola and Metro services in Delhi and Mumbai.
- PhonePe tied up with GoIbibo to provide flight booking in-app. PhonePe already has a tie-up with GoIbibo for hotel booking.
- PhonePe partnered with digital payments company PayU which enables PhonePe as a payment option when using PayU’s online gateway system.
- PhonePe tied up with the IRCTC to facilitate payments on the IRCTC Rail connect Android app.
- PhonePe entered into a partnership with Ola Cabs where users could book an Ola through the PhonePe app. With this integration, PhonePe users can also avail an AutoPay feature.
MobiKwik allows UPI payments from ICICI Bank through its payment gateway aggregator ZaakPay. What this means, is that MobiKwik users can load money to their wallets using the UPI and which will be processed by ICICI Bank.
- The firm launched an ‘Explore Nearby’ feature on its app, which lets users discover neighbourhood stores, restaurants, cafes etc., that accept payments from the company. The company said that it currently has over 10,000 partner stores including merchants like Big Bazaar, Domino’s, Barista, Archies etc.
- MobiKwik is a mode of payment at 391 toll booths on Indian Highways. The company said that it received approval from National Highways Authority of India (NHAI) for the cashless payment method.
Google Pay is testing UPI based transactions with unspecified point-of-sale (POS) providers to onboard retail merchants, to move away from peer to peer transfers and small scale pilots with retail stores.
- Uber added Google Pay as a payment method on its platform. Users can add their Google Pay UPI ID and clicking ‘accept’ on Google Pay when Uber’s ride notification is sent out.
- PayPal launched PayPal for Business, an app for small, medium and freelancing merchants in India to manage their domestic and international payments.
- Razorpay partnered with the Indian Railway Catering and Tourism Corporation (IRCTC) to help customers book train and flight tickets through UPI, in addition to other payment modes like net banking, wallets and credit/debit cards.
Growth of digital payments in India
Digital payments, especially via the Unified Payments Interface (UPI), have seen huge growth in the past few years. Between May 2018 and May 2019, the volume of UPI transactions increased from 189.5 million to 733.5 million, marking an almost 400% increase, while the amount transacted has shot up from ₹32,885.5 crore to ₹152,449.3 crore, a roughly 500% increase.
Between April 2019 and May 2019, the amount transacted increased by ₹10,414.9 crore, the number of transactions fell from 781.8 million to 733.5 million. However, the average amount per transaction grew to ₹2,078 in May 2019, up by almost 10% from April 2019.