Google and Walmart rule India’s payment application domain at the moment through Phone Pe and Google Pay, which are neck to neck with other apps like Paytm, but this has had Facebook struggling to launch its WhatsApp Pay application.
In May, 60 million users were transacting through Phone Pe, while Google Pay had 75 million users transacting through the app. Paytm, backed by Softbank, was ahead of both these apps as ten million daily users have been transacting through it. These numbers are the reason why Facebook is skeptical about launching another payment-based application.
Paytm has had the edge over all other applications because of the reach it has been able to establish among merchants, which Google Pay lacks at the moment. Despite that fact, Google Pay has maintained the momentum it had earlier even after India being under lockdown for the past two months.
There have been antitrust probes in India for Google, as it is believed that the company is using its position in the market to promote a mobile payment application under their umbrella unfairly. Paytm has also been struggling to sustain its user base for the last two years, as it has been reported by sources familiar with the matter. In January, there were nearly 60 million transacting users, and in May, the same number has been reported to be 50 million.
Transacting users in the data collected for any of the mobile payment applications are counted as the ones that make at least one transaction through the app in a month. The number is different from monthly active users and daily active users, but usually, most firms share to the public to indicate their growth and progress. Many monthly active users aren’t making transactions through the app, which is the main difference between the numbers.
The struggle that Paytm has seen during the last few years has come because of the mandate by Reserve Bank of India to all mobile wallet firms that KYC is mandatory. The KYC procedure has created confusion among users, but Paytm has also successfully raised more money despite the hurdles that have come forward. More than 3 billion dollars have been invested in the Indian payment firm by new investors.
The model that Paytm has followed has been successful as they have been able to set up the infrastructure to do KYC. 100 million users have completed their KYC now because of the effort taken by Paytm to meet users physically. Little benefit has also come from the integration with apps like Uber, Swiggy, etc. but only a little fragment of the transactions have come from these apps over the past few months.
On the other hand, Facebook is planning to launch its mobile payment app in India, which the company considers its biggest market. The idea has been to reach $1 trillion by 2023 after talking with numerous banks and with the help of WhatsApp Pay. The application WhatsApp Pay was launched for only a million users, but the decision to open it up for the rest of the users has been under work still. The parent company has faced new challenges, but the plan is to roll out the app by the end of the year for all users.
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