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Google's Tez payments app clocks 7.5 million installs in a month

Google might have entered the space a year late, but competition is still scarce

Romita Majumdar  |  Mumbai 

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A little over a month after entering into the digital payment ecosystem in India, Google’s Unified Payments Interface (UPI) app Tez has racked up 7.5 million users who have made over 30 million transactions.

In a call with investors on Friday, CEO Sundar Pichai said that he was “really excited about the potential this (Tez) brings for India's mostly cash-based economy” while also revealing the growth figures for the app.

While has not been able to demolish rival BHIM’s record of getting 10 million installs in just 10 days thanks to Prime Minister Narendra Modi backing, but it’s a commendable feat considering that Tez has lacked several features at launch.

But coming into the payments space a little more than a year late, has demonstrated that there still is space for growth in India’s ecosystem. Tez also sets the precedent for to invest in more region specific products, which it has rarely done before.

“We see a way to look at these markets with a lot more thought and address them for the opportunity that they have, not just apply our global products there. So I think that's what led us to do Tez in India. And we'll thoughtfully look at the opportunities in that region and invest a lot in the years ahead,” added Pichai.

Analysts say that despite the space in India being somewhat crowded, the massive opportunity that India offers ensures there’s still enough room for growth of new players. Also, changes in regulations have helped become the preferred mode for P2P and P2M payments, since unlike other modes transactions remain free.

might be the first global giant to get into India’s fast-growing digital payment space, but other heavyweights such as WhatsApp, Facebook and Apple are on their way.

“Sometimes, there is a late-mover advantage as well when the or concept is emerging and one can learn from other’s mistakes. The Indian market has huge opportunity and despite the presence of a number of players it is hugely untapped,” said DD Mishra, Research Director Gartner.

While on the surface Google’s Tez might seem similar to the app, the company has brought a number of new features to the table. Tez is the first app that uses multiple partners to power its service, it has a mode that uses unique audio frequencies to pair two nearby devices to enable payments. Google’s Tez Shield that is powered by machine learning to detect fraud is another feature that quells a user's fear of losing money.

“Users are finding the Audio QR / Mode transaction very easy to use. Audio QR usage is five times of the normal QR codes on Tez. Given the high merchant adoption of UPI, we’re seeing users use Tez for paying for their daily transits, food and entertainment, grocery payments and high value transactions like rent, and flights,” said Diana Layfield, Vice President, Product Management,

Layfield notes that India is unique in providing an interoperable network for payments within bank accounts, giving the company the chance to build a product specific to India.

Prior to the launch of Tez, analysts had voiced their doubts on the success of an Android Pay type of service in India. However, with forgoing the use of near field communication (NFC) based systems given its low acceptance at terminals and lack of affordable with the technology, and instead creating solutions that will work in India, analysts are now seeing possibilities of success.

Google’s Android operating system powers over 95 per cent of in the country and its Search, YouTube, Gmail and Maps services are among the highest used by customers in India. With reach not being a problem for a giant like Google, it could give local players such as Paytm, and Axis Bank owned Freecharge a run for their money.

“The best way to tap the evolving market is to bring something which is aligned to the current level of maturity and requirements addressing the existing gaps and taking advantage of the differentiation. Once the market is ready for adoption of Android Pay, it will become easier for to capture the market share and mind share by that time,” added Mishra.

Despite everything brings to the table, competition in the space isn’t going to get easier. Flipkart has committed to invest $500 million in PhonePe, has raised nearly $2.5 billion so far, and the app is now being promoted through a massive planned advertising campaign sponsored by the government.

First Published: Fri, October 27 2017. 09:35 IST