Flipkart Partners With Axis Bank To Hop Onto UPI Bandwagon

Walmart-backed ecommerce major Flipkart has joined the Unified Payments Interface (UPI) bandwagon with its own payment offerings Flipkart UPI in partnership with Axis Bank.

This marks Flipkart’s second fintech offering with Axis Bank after it rolled out co-branded credit cards with the lender in 2019.

With this launch, the company will compete against Amazon’s payment vertical Amazon Pay as well as Paytm, PhonePe and Google Pay in the digital payment space.

This UPI handle will provide both online and offline transactions, including e-commerce transactions, recharges and bill payments.

Loyalty perks like Supercoins, cashback, rewards for milestones and brand vouchers will be offered once UPI is launched, the company said.

In 2022, Flipkart, which acquired PhonePe in 2016, fully separated its ownership from the digital payments platform. It is pertinent to note here that PhonePe has close to 50% market share in UPI payments.

Flipkart has been trying out its UPI feature since last year. It will let users make UPI payments within the app, without needing other apps. This offering seems significant because it helps lessen UPI’s dependence on just a few big players, which aligns with what NPCI wants.

“With UPI emerging as the preferred payment option, the launch of Flipkart UPI will provide unparalleled convenience and zero-cost solutions, democratising access to seamless payment options. The UPI offering will enable smooth onboarding and allow users to conveniently avail of the feature for online and offline merchant transactions within and outside the Flipkart marketplace,” the company quoted Mint as saying. 

Dheeraj Aneja, senior vice president, fintech and payments group at Flipkart, said, “The launch of Flipkart UPI seamlessly merges the convenience and cost-effectiveness of UPI with the trusted efficiency customers expect from us. At Flipkart, we are committed to delivering the best-in-class commerce experience to customers by offering safe and convenient payment options along with a wide array of rewards and benefits such as Supercoins, brand vouchers, and others.”

Sanjeev Moghe, president & head, cards & payments, Axis Bank, said, “Our partnership with Flipkart has come a long way from launching one of India’s most successful co-branded credit cards to now launching the Flipkart UPI service. Customers can now register for UPI with the @fkaxis handle and can do all fund transfers and checkout payments using the Flipkart app. This solution is cloud-hosted and hence provides one of the most stable and scalable UPI platforms for customers.”

Meanwhile, Flipkart’s marketplace arm, Flipkart Internet, has received a cash infusion, raising about INR 924 Cr ($111 Mn) in two parts from its related entities based in Singapore.

As per ROC filing, the Walmart-backed ecommerce giant received fresh capital from the firm’s related Singapore-based entities on January 8 this year. The company approved two resolutions to infuse capital into it on December 20 and 22 last year.

This comes at a time when Flipkart is seeing massive growth in sales. Flipkart’s Big Billion Days, which took place in October last year, was the largest ever and saw around 1.4 Bn customers visiting the eight-day event (8-15).

Flipkart Internet primarily earns revenue through commission charges and other services it offers to merchants, including advertising of products. Its operating revenue zoomed 42% to INR 14,845.8 Cr in the financial year 2022-23 (FY23) from INR 10,477.4 Cr in FY22.

The ecommerce major’s net loss declined 9% to INR 4,026.5 Cr in FY23 from INR 4,419.5 Cr in FY22. Total expenditure rose to INR 19,043 Cr in FY23, with ESOP costs accounting for INR 2,155 Cr.

As per Inc42’s State Of Indian Fintech Report, the total addressable market for Indian fintech is expected to reach $2.1 Tn by 2030, with a CAGR of 18% from 2022. India’s fintech sector has attracted over $24 Bn in investments since 2014 and is home to 22 unicorns and 33 soonicorns.