Flipkart-owned digital payments
claims that it has emerged as the largest player using Unified Payments Interface (UPI) for merchant payments, controlling close to 80 per cent of all transactions in that space.
While the government’s BHIM app
continues to lead the market in terms of an overall number of transactions on UPI, it largely solves only for person-to-person payments. PhonePe.
on the other hand, says it is better suited to allow people to pay merchants to buy products or services on its platform.
“For us in this business consumers and merchants are equally important. We are not only focusing on consumers through offers but are building a lot of customised solutions for merchants, be it online or offline, as well,” said Pradeep Dodle, head of business development, PhonePe.
says it has tied up with 25,000 merchants to accept UPI
payments through its app, including big names such as Apollo Pharmacy, Cafe Coffee Day, Barista and Spencer’s. While Flipkart’s immediate rivals haven’t adopted PhonePe’s service, Dodle says he’s happy with the number of tier-II e-commerce vendors using the company’s services.
With about 55 per cent transactions on its app involving merchants, the company is poised for growth as the adoption of UPI
continues to rise. While payments from person to person is what has helped the initial adoption of India’s indigenous payment technology, the real growth will come when people begin purchasing products and services using UPI.
Several global firms such as Google, TrueCaller and WhatsApp are adopting UPI
to allow payments on their platform and retain users within their ecosystem.
Despite being owned by Flipkart, PhonePe
says it has remained independent enough to ensure merchants don’t see it as a competitor. Unlike some of its competition, PhonePe
isn’t trying to get into any of the businesses of its partners — Paytm has entered into movie and event ticketing on its own, pushing partners such as BookMyShow away.
“We want to work with them. We are taking more of a collaborative approach and are looking at more long-term partnerships. It is working and probably that’s where Flipkart
comes in because these merchants see it as a trusted entity. That’s probably because Flipkart
has never got into any new space as a knee-jerk reaction,” says Dodle.
While competitors such as Paytm and others have already tapped several offline merchants to accept payments through its digital wallet, Dodle says UPI
will give digital wallets a run for their money since merchants would prefer getting the money directly into their bank accounts. Moreover, post-demonetisation, wallets have begun charging merchants a transaction fee or to move their money from the wallet to their bank account, whereas UPI
continues to remain free.
says it is going live with 15 large format retail chains who have presence across the country by the end of the quarter. Further, it is in the process of partnering with 50 online merchants across food, travel and shopping.
transactions crossed the 11-million mark in July, being among the fastest growing forms of digital payments
in India. The government, however, doesn’t break out specific numbers for P2P and P2M payments made through UPI, with the general expectation being that the payment mode is still used for transferring money from one person to another.