Spice Money: Industry Monitoring 27 March 2019
- Priyanka Kanodia
- Mar 27, 2019
- 5 min read
Spice Money
Industry News
Flipkart board okays PhonePe hive off plan
Publication- ET Tech
Edition- Online
Date- 27 March, 2019
Digital payments company PhonePe has received in-principle approval from Flipkart's board to be hived off as a separate entity, two people aware of the matter told ET. This will set the stage for the Bengaluru-based PhonePe to create an independent board and raise fresh funding from external investors. It’s not clear how much Walmart-owned Flipkart will divest of its 100% shareholding in PhonePe, but the payments firm is looking to raise up to $1 billion in external capital, people close to the matter said. Flipkart’s existing investors such as China’s tech giant Tencent and the online retailer’s co-founder Binny Bansal are keen to back the payments firm, which leverages the Unified Payments Interface (UPI) system for settlements, said the people cited above.
Other bulge-bracket private equity funds have also shown interest in the company. “PhonePe has held talks to raise $1 billion and has been scouting the market for a while now,” said one of the persons. “But now with the Flipkart board giving it a nod to become independent, the actual process of fund-raise will start. They are fighting a player like Paytm, which has the backing of SoftBank, therefore they need huge sums of capital to compete.” The board approval for the plan came a few weeks ago, the person said.
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UPI took a little tie but it has arrived
Publication- The Financial Express
Edition- Online
Date- 27 March, 2019
The Unified Payments Interface (UPI) has taken little time to come into its own. In the month of its launch in August 2016, it had 21 banks on its network, which yielded a low transaction volume of 93,000, worth a little over Rs 3 crore. Its annus mirabilis arrived as early as in 2017-18, with the launch of the Bharat Interface for Money (BHIM) app and the on-boarding of Google Pay (then Tez) and Paytm leading to a surge in usage. And the figures for February 2019 reveal how far it has come its launch: The number of banks offering UPI payments has surged to 139 and the volume and value of UPI transactions stand at 674 million and Rs 1.7 lakh crore, respectively. In August 2018, the National Payments Corporation of India (NPCI), its parent, launched an upgraded version of the UPI with a bank account-to-bank account payment feature that allowed money to be transferred using nothing more than a phone number.
And yet, despite recording an exponential growth in terms of usage, UPI has not been able to achieve all its objectives. While NPCI does not release disaggregated data on peer-to-peer (P2P) and P2M (peer-to-merchant) UPI payments, it is commonly accepted that UPI’s growth over much of its journey has been largely led by P2P transactions, even as contributions from merchant transactions have been rising in recent months. In a 2018 interview to FE, NPCI managing director (MD) and chief executive officer (CEO) Dilip Asbe said the offline growth was tough because banks and third-party players had to invest money to acquire merchants and train them. “It’s a demand-and-supply situation, where a consumer should be willing to pay through this mode and that merchant should be enabled.
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Amazon Pay makes an offline push with ‘scan and pay’ service
Publication- Livemint
Edition- Online
Date- 27 March, 2019
Amazon Pay, the online payments service owned by the world’s biggest online retailer, is planning to introduce “scan and pay" service at neighborhood stores, said three people familiar with the matter, requesting anonymity. Amazon has already introduced the payments service in department store chain Shoppers Stop, in which the online retailer owns a 5% stake, and will soon set up the necessary infrastructure at grocery chain More. “Since it (Amazon) has a stake in these two chains, it is starting offline payments with these stores," said one of three people cited above.
“Subsequently, it will start reaching out to merchants, which would take more time as it is in the unorganized sector." Amazon confirmed the development. “We have begun introducing Amazon smile code, a new way for our customers to shop and pay at physical stores like Shoppers Stop, among others," said an Amazon spokesperson. “Customers will soon find Amazon smile codes in neighborhood retail stores, where they can scan and pay for their purchases seamlessly."
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True Balance introduces 'Pay Later' options for electricity, mobile bills Publication- Gizbot
Edition- Online
Date- 27 March, 2019
True Balance, a one-stop payment solution app, has announced the launch of 'True Pay Later' which will allow users to pay their electricity bills, mobile and DTH recharges in two payments. To avail the 'True Pay Later' service, users will have to pay a nominal service fee upfront and the balance principal amount within a period of 14 days interest-free credit. This paperless, digital service is aimed at helping tier II/III users to buy services/products in parts if they are unable to pay the whole amount at once.
"We recently launched the UPI service for our 70 million users, and now we are delighted to introduce this new fin-tech service 'True Pay Later'. This will hugely benefit those users who cannot afford to pay the complete amount in one go. We are currently having 8000 - 10000 transactions daily and we are sure these numbers will increase rapidly," Charlie Lee, CEO, True Balance, at the launch of 'True Pay Later' said.
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Payments fintech Airwallex raises $100m series C funding
Publication- Money Control
Edition- Online
Date- 27 March, 2019
Airwallex confirms unicorn status following a successful Series C fundraising round of $100m USD, valuing the company at over $1bn USD. The new capital will be used to expand Airwallex's suite of international collection and payment products and to support global expansion into the US, UK / Europe and Southeast Asia.Founded in 2015, Airwallex has grown from an emerging start-up to a global challenger in the cross-border payment space. Airwallex offers an end-to-end solution for businesses to make payments and move money programmatically on a global scale, supporting a client base of internet titans including JD.com, Tencent and Ctrip, and large financial service companies including MasterCard.
With Airwallex, customers can instantly create Global Accounts with local bank details, access interbank exchange rates and send money through local and international clearing networks to more than 130 countries. Top-tier investor DST Global led the Series C fundraising round, which closed at $100m USD. DST Global has been a primary investor across a number of global technology success stories, including Facebook, Airbnb and Spotify, and other fintech leaders, such as Nubank and Robinhood.
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