Flipkart has solved its e-payment problem

Flipkart has reportedly bought a majority stake worth $6.5 billion in payment services platform FX Mart, reports Tech in Asia

Flipkart, India’s largest e-commerce store, today reportedly bought a majority stake worth $6.5 billion in payment services platform FX Mart. The deal will also place two Flipkart senior executives at FX Mart.
 

Closed, semi-closed and open wallets

Payments have been a pain point in Flipkart’s past.
 

PayZippy, its first attempt at an independent payment gateway service, was forced to operate on a mechanism called “closed wallet”. This meant that customers were only allowed to spend their wallet money on products sold by Flipkart. It was shut down in August 2014.
 

At the time, the “closed wallet” was the only option available for sites that wanted to provide payment services. In the past year, however, the Reserve Bank of India (RBI) has loosened its strict regulations to accommodate different payment structures. They have now distinguished three kinds of e-wallets: closed, semi-closed and open.
 

Closed wallets restrict customers to purchases on a single website and do not require RBI approval.
 

Semi-closed wallets can be used internally and at specified merchant sites. FX Mart operates as a semi closed wallet. For Flipkart, this means that customers can now use the wallet to buy from third-party sellers, native site sellers and recently acquired fashion portal Myntra.
 

Open wallets can only be issued by banks and are generally used for single-click checkouts on partner merchants’ websites. A recent example of an open wallet company is mobile toupees site MobiKwik. When customers are redirected to payment on partnered websites, MobiKwik is offered as a payment solution along with other debit cards and credit cards. Unlike closed or semi-closed wallets, open wallets allow cash withdrawals at ATMs.
 

A recent surge in RBI wallet approval has propelled the creation of a number of competitive e-payment services across India.

This is an excerpt from Tech in Asia. You can read the full article here.