Ambika Pande’s Post

Insightful comments on the online payment industry by Ambika Pande . Worth a read

 ✳️India rushes to limit PhonePe and Google's control in mobile payments. https://shorturl.at/xBCQ0  ➡️ NPCI, overseeing UPI, plans to engage with fintech startups to counter the dominance of PhonePe and Google Pay. ➡️ UPI, formed by Indian banks, is the leading online transaction method in India, handling over 10 billion transactions monthly. ➡️ RBI is considering incentive plans to support emerging UPI players, while NPCI encourages fintech companies to offer user incentives to promote UPI transactions on their apps. #like #share #IndiaPayments #MobilePayments #UPI #Fintech #Competition #Regulation #DigitalIndia #TechInnovation #MarketDominance #FinancialInclusion

✳️India rushes to limit PhonePe and Google's control in mobile payments. https://shorturl.at/xBCQ0 ➡️ NPCI, overseeing UPI, plans to engage with fintech startups to counter the dominance of PhonePe and Google Pay. ➡️ UPI, formed by Indian banks, is the leading online transaction method in India, handling over 10 billion transactions monthly. ➡️ RBI is considering incentive plans to support emerging UPI players, while NPCI encourages fintech companies to offer user incentives to promote UPI transactions on their apps. #like #share #IndiaPayments #MobilePayments #UPI #Fintech #Competition #Regulation #DigitalIndia #TechInnovation #MarketDominance #FinancialInclusion

🚀 Exciting news in the fintech world! Mswipe Technologies Pvt. Ltd. has been granted a payment aggregator license by the RBI. This significant milestone follows the company's in-principle approval from the central bank to operate as a payment aggregator earlier in August 2022. In support of this, Mswipe has announced its plans to develop an in-house online payment gateway and provide comprehensive payment solutions to both offline and online merchants. Notably, Mswipe joins the ranks of other pioneering fintech companies such as Razorpay, Cashfree Payments, Open Financial, EnKash, Google Pay, and Paymate India, who have also received the final nod for the payment aggregator license. Additionally, Mswipe has reported a remarkable 45% reduction in net loss, dropping from INR 90 Cr in FY22 to INR 49.1 Cr in FY23, demonstrating their successful efforts in reducing cash burn. #fintech #startup #rbi #payments #Mswipe #Razorpay #CashfreePayments #OpenFinancial #EnKash #GooglePay #PaymateIndia

SoftBank-backed Juspay now has RBI's approval to be a payment aggregator! And, this could be a big THREAT to Razorpay. But, how? Here's the background: Juspay, the company behind BHIM UPI and Namma Yatri, is evolving. Previously, it served as a payment gateway unifier, handling the technology behind transfers. Now, with approval from the RBI, it is expanding its role to become a payment aggregator, managing funds and settlements. This change puts Juspay up against big names like Razorpay, PayU, and PineLabs. And, Juspay isn't new to big projects. They've worked on major government initiatives and have current clients like CRED, Myntra, JIO, and many more. So, it's in a strong position to lead in this field. Here's why: 1. Beyond Just a Gateway: With RBI's approval, Juspay steps up as a full-stack payment aggregator. This lets them handle money directly. It's a big move from just unifying gateways to owning the whole payment process. This could mean more market share and higher revenue. 2. Tech Edge in Payments: Juspay is renowned for its technical expertise and reliability. They possess technology that enhances the likelihood of successful transactions. In a market where transaction failures are common, this is a significant advantage. It could attract more businesses, posing a direct challenge to Razorpay and others. 3. New Markets, New Opportunities: Juspay isn't just sticking to traditional payment aggregation. It's exploring business payments, open credit networks (OCEN), and the Open Network for Digital Commerce (ONDC). This broadens its market reach, possibly outdoing competitors. 4. US Expansion with Hyperswitch.io: Juspay's move into North America is a bold step. They're taking their open-sourced payments platform, Hyperswitch.io, to new markets. This isn't just about more money. It shows Juspay's ambition to grow globally, which could put them ahead of competitors focusing only on India. 5. Financial Muscle for Innovation: With $60 million from SoftBank and a 70% revenue jump from FY21 to FY22, Juspay has resources for tech investment and market expansion. This financial clout lets it compete fiercely with established players. All of these factors place Juspay in the same arena as larger, more established players who have been in this market for years. However, Juspay's technical prowess and current standing indicate its ability to compete. Now, everything hinges on Juspay's ability to fulfill its promises, provide superior and more comprehensive offers, and maintain trust and reliability with its partners. #startups

Exciting News Alert! Indian payment solutions provider, JUSPAY, reports impressive financial results for FY23, showcasing the surge in digital payments adoption nationwide. Revenue soared by 89% to INR 213.3 Cr, highlighting strategic execution and increasing demand for Juspay's payment solutions. Despite a minor net loss increase of 4% to INR 105.7 Cr, attributed to investments in research, development, and acquisitions, Juspay remains positioned for growth. Founded in 2012 by Vishal Gupta and Vimal Kumar, Juspay offers secure and user-friendly payment solutions, earning trust across merchants and consumers. With India's digital payments market poised for exponential growth, Juspay's technology and partnerships position it for continued success. Valued at $500 million, Juspay attracts significant investor interest. Strategic initiatives like the acquisition of LotusPay in March 2023 further strengthen Juspay's market presence and product portfolio. Juspay's remarkable revenue surge underscores its leadership in India's digital payments landscape, solidifying its position as a frontrunner in the industry. #DigitalPayments #Fintech #FinancialResults #Juspay #PaymentSolutions #StrategicGrowth #Innovation https://lnkd.in/dDCSsCSn

There is usually good reason to be skeptical these days about a loss-making fintech with a sky-high valuation, but India’s PhonePe – valued at US$12 billion – could be an exception to the rule. The company has fought its way to the top of the subcontinent’s massive UPI payments rail, edging out Google Pay and Paytm, is gradually building out a comprehensive digital financial services ecosystem and continues to raise huge sums from investors at a time when the easy money no longer flows. PhonePe’s CEO and founder Sameer Nigam said in late August that the company expects to achieve operational profit by 2025, adding that by that time its payment, advertising, banking and insurance units would all break even. He made a crucial point in a speech at the launch of PhonePe’s stock trading platform: "We don't have to spend much on the marketing side there. I think at the group level, we have enough capital to deploy on Pincode and Share (dot) Market; let them grow while we still hit EBITDA positive by 2025." If Nigam is confident that PhonePe can eschew a heavy subsidy outlay even as it launches new products in a highly competitive market landscape, then the strategy to build out the company’s suite of services starts to make a lot more sense. When it comes to PhonePe’s core payments business, low margins aside, the company is doing well. It is the market leader in UPI payments with a 50% market share, edging past Google Pay. Given that there are almost 7 billion UPI transactions per month, it is no surprise that PhonePe’s total payments volume has exceeded US$1 trillion. PhonePe is also embedding itself ever deeper into the UPI ecosystem. It recently became the first payments fintech to link two lakh NPCI’s RuPay credit cards to UPI. PhonePe also aims to piggyback on UPI’s global expansion, where it sees an opportunity to move into the huge forex market. In February, PhonePe said it would extend support for UPI international payments in the UAE, Singapore, Mauritius, Nepal and Bhutan. There are other reasons to be sanguine about PhonePe. In March, the company announced that it had received an in-principle approval for its payment aggregator (PA) license from the RBI. This approval will allow the company to scale its payment solutions and enable digital inclusion for more Indian SMEs. Second, PhonePe just launched an app store in India that will compete with Google Play. PhonePe will not charge developers any listing fee for the first year but plans to eventually move to a "nominal" cost. Further, PhonePe may undercut the U.S. tech giant as it does not plan to charge a commission for in-app purchases compared to the 15% to 30% Google usually takes. Indian companies have long wanted more choice when it comes to an Android app store: PhonePe aims to offer that to them. #phonepe #india #payments #fintech #google #walmart #venturecapital #banking https://hubs.li/Q023klvr0

India's most-valued fintech PhonePe is going aggressive on payment aggregator biz. How? By price undercutting. Why? To monetize UPI. Today's story is on PhonePe's PA strategy. Some tidbits: The market is at a very interesting juncture as top 4 PAs, PayU India, Razorpay, Cashfree, and Paytm – despite receiving ‘in-principle’ – are barred by RBI from onboarding new clients. So, the new ones are trying to grab as much market as possible because the market is vacant. The largest UPI payment processor PhonePe popped up as one of UPI apps when doing e-commerce payments; but now the fintech giant has launched a full-fledged PA. Over the last couple of months, PhonePe has been running ads offering 0% TDR instead of industry standard of 2%. Why? Being just an UPI app, PhonePe couldn't charge for UPI txn. Thus, monetizing UPI is key. Existing PAs mostly play on a ‘bundled offering’ and charge merchants 2% (cards/netbanking/UPI txn) - and call it a TDR/platform fees. As per industry estimates, of total revenues a PA makes, about 25-30% of that must be coming by charging UPI transactions via bundled offering. “With PA, you can monetize your payments but being just an UPI app, you can’t at all. However, the margin isn’t much. The real margin will come when you add more products on top – especially credit. If you have got large customer base through PA biz then with that data, you can build a lending business on top. The goal is to maximize customer and not margin or profitability,” an official says. Read the story to know about the financial services gameplan of PhonePe in detail. #fintech #payments https://lnkd.in/dP3EYKMp

The Indian retail payments industry is a near duopoly, with PhonePe and Google Pay controlling over 80% of the largest market segment - #upi. We certainly need new entrants with deep pockets to expand the market and ensure consumer choice. At the same time, a new entrant like IRCTC, 67% owned by the government, and a monopoly in its core business, might have the opposite effect - of scaring away other new entrants from an already fiercely competitive market with wafer-thin margins. The bigger question is whether government should be in business at all. What do you think? Would love to know your thoughts in the comments. #payments #india #competition #newentrants #incumbents #innovation #monopoly #oligopoly

E-commerce and fintech firms are cutting costs by restructuring their payment collection setup. Lately, there has been a rush to obtain Payment Aggregator (PA) licenses. Within the last 6 months, firms like Amazon Pay, Cred, Gpay, Zoho, Groww, etc. have received PA licenses or in-principal approvals for the same. A payment aggregator provides payment collection/gateway options (like UPI, credit/debit cards, net banking, EMI) on a single platform for merchants. Simply put, it's the page that opens up to select the preferred payment mode while making a transaction. I am sure you would have noticed a message at the bottom stating 'powered by Razorpay/Billdesk/CC avenue etc.' But why this rush, after all? To receive and collect money, companies integrate with a PA and pay them a transaction charge of up to 2% of the amount. Now, getting a PA license and becoming an aggregator itself may help a merchant reduce this cost. For instance, Swiggy has a gross order value of approx. Rs 7,000 Cr/quarter. Even a 1% commission to a PA firm would be Rs 70 crore/quarter (280 Cr annually). Similarly, e-comm and fintech may benefit from an in-house payment aggregation. However, its financial viability depends on the commercials negotiated between PAs and banks for each collection mode. Not to forget the technology, maintenance, and compliance costs of an in-house setup. Having said that, it does provide scope to enhance UX, speed, and the overall customer journey.