Amazon Pay (India) Pvt Ltd, Indian digital payments arm of the global ecommerce company Amazon, has announced the financial results for the fiscal year 2017-18 with a leap of 5100% in revenues and 88% in losses.
According to the filings accessed via Tofler, a business intelligence platform for India, the company recorded revenues of $53.18 Mn (INR 393.5 Cr), against $1.09 Mn (INR 7.47 Cr) in the previous year.
At the same time, the company’s net loss made 85% of its revenues reaching $45.17 Mn (INR 334.2 Cr). The net loss was a jump of 88% from $24.04(INR 177.88 Cr) for the previous year.
With a net worth of $47.3 Mn (INR 349.99 Cr), Amazon Pay showed huge growth in its expenses as well as revenues, here’s a summary of its financial statistics for the year:
- The company’s operational revenues constituted 98% of its total revenues reaching $5.25 Mn (INR 389.1 Cr)
- At the same time, other expenses constituted 88.78% of the company’s total expenses reaching $87.32 Mn (INR 646.1 Cr)
- Another major jump in expenses came from employee benefit expenses reaching $11 Mn (INR 81.4 Cr), an increase of 82.3% from the previous year $6 Mn (INR 44.65 Cr)
- The company’s advertising promotional expenses for the year were $34.78 Mn (INR 264.7 Cr), a jump of 113% from $16.74 Mn (INR 123.9 Cr) in the previous year
As the company invested heavily on its advertising and promotions, the directors of Amazon Pay noted that “Amazon Pay Balance: Money” was a key initiative to drive customer behaviour shift from cash to digital means for their payments both on and off Amazon.
“While the services of the company saw significant adoption in a short period of time, the new KYC regulations have impacted customer experience and negatively altered the migration trajectory of cash customers to digital. APIPL, however, remains committed to solving this challenge and has applied for a KUA license to offer customers digital Aadhar-based KYC services which are currently under review with UID,” the company noted in the fillings.
For the coming year, the company has announced to continue to invest in product and technology to improve customer payment experience and work towards supporting the government’s mission of a Digital India.
The ecommerce giant began its journey in the Indian fintech space in December 2014 after investing about $10 Mn in Bengaluru-based gift card technology and retail startup, QwikCilver Solutions. As of now, it has also merged e-gift cards into Amazon Pay.
In December 2016, Amazon launched Amazon Pay Balance, a payment option which is similar to how mobile wallets work but limited to transactions within the platform.
In October this year, the company got a bump of $79.8 Mn (INR 590 Cr) from the parent company, after receiving $33.5 Mn (INR 230 Cr) earlier in July 2018, taking total investment to nearly $216.8 Mn (INR 1,600 Cr) since 2016.
The overall digital payment scenario in India is burgeoning with opportunities. With NPCI rooting on UPI 2.0, recording 405.87 Mn transactions in September 2018 for a value of $8.18 Bn (INR 59,835 Cr), the state of digital payments in India seems to be improving.
According to a July 2018 report by Niti Aayog, titled “Digital Payments – Trends, Issues and Opportunities”, the digital payments market In India is expected to grow to $1 Tn by 2023. The report also stated that the mobile payments industry is slated to rise from $10 Bn in 2017-18 to $190 Bn by 2023.
With a huge opportunity knocking on the door for Amazon Pay, the company’s performance for the year could be a good headstart against the burgeoning competition.