With a view to expand its digital payments portfolio in Japan, Indian payments company Paytm is collaborating with PayPay, SoftBank and Yahoo Japan’s newly launched digital payments company.
PayPay Corporation, which was established in June 2018, will offer smartphone payment services using barcodes (QR Codes). PayPay aims to leverage Paytm’s technology and expertise in mobile payments. The services will be launched in the fall of 2018.
Inc42 had earlier reported that SoftBank and Paytm are collaborating to launch a mobile digital payments service in Japan by the end of 2018 as SoftBank chief Masayoshi Son seeks to expand the company’s presence in the sector.
The Japanese government wants to reduce the country’s dependence on cash and is taking measures to raise the cashless payment ratio to 40% by 2025, with a long-term goal of 80%.
PayPay will promote cashless payments in Japan and provide highly convenient services to both consumers and affiliated stores.
SoftBank, Yahoo Japan, and Paytm want PayPay to become the top provider of smartphone payment services in terms of the number of users as well as affiliated stores.
They will expand PayPay’s userbase by including the customer base of SoftBank and Yahoo! Wallet, which comprises approximately 40 Mn accounts.
The trio will also use SoftBank’s sales know-how to deploy the PayPay platform and develop tailored services for Japan leveraging Paytm’s payments technology.
After the launch of PayPay, Yahoo Japan will terminate Yahoo! Wallet’s current smartphone settlement function. After this, the PayPay platform will be seamlessly integrated with users Yahoo! JAPAN ID, providing existing Yahoo! Wallet customers the option to use PayPay services within Yahoo! JAPAN’s smartphone application.
Once PayPay is launched, customers can select from two types of payment methods — credit cards and electronic money.
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The initial setup cost of stores affiliated with PayPay under the “user-oriented code-reading format” is very low as the merchant only needs to display the code inside the shop, similar to how Paytm affiliates display their barcodes a their shops.
PayPay also plans to offer the service for free to stores seeking affiliation for the first three years with a view to expand its presence across Japan.
Paytm launched its first international services in Canada in March 2017, enabling Canadian users to pay their mobile, cable, Internet, electricity, and water bills with the help of the Paytm Canada app. The app also enables users to pay their insurance premiums and property taxes.
Paytm’s good days started with the demonetisation announced in November 2016. Since then, the company has been on an upward growth trajectory, diversifying its portfolio into insurance, lending, payments bank, events, etc. From reaching 300 Mn customers on Paytm to launching Paytm Payments Bank, the company is making waves in the digital payments industry, ecommerce, and even ticketing.
With its expansion into Japan with the support of its major investor SoftBank, Paytm seems to be ready to conquer more international territory.