Digital payments company PhonePe has been generating a lot of interest from investors, partners and customers. The growth has now received a testament as the company announced that it recorded 335 Mn UPI transactions in July.
Data by National Payments Corporation of India revealed that in July 2019, UPI recorded 822.29 Mn transactions. This means that out of total UPI transactions, 40.7% were on PhonePe.
The company said that it has achieved an annual TPV (Total payment volume) run-rate of $95 Bn. It said that this is nearly 5X growth in the past year, since crossing the $20Bn mark in June 2018.
PhonePe said that growth has come on the back of the exponential expansion of PhonePe’s merchant network, both online and offline. It also invested aggressively on its marketing activities this year.
Sameer Nigam, CEO and founder PhonePe said that in July, the PhonePe app was used by 60 Mn users. Recently, PhonePe received INR 697.9 Cr ($101.5 Mn) equity infusion from its Singapore-based parent, PhonePe Private Limited Singapore.
PhonePe is one of the essential parts of Walmart’s reason to invest in the Flipkart group last year. Interestingly, Walmart’s entry had seen a major reshuffle in the management teams of Flipkart, its fashion subsidiaries Myntra and Jabong, but no such big movement has come to the PhonePe team.
Flipkart had bought PhonePe from its founders aka ex-flipsters Sameer Nigam, Rahul Chari and Burzin Engineer in 2015. It offers peer-to-peer transfer, recharges, bill payments, gold purchases, among others.
Apart from providing a point-of-sale device for offline vendors, the company is diversifying its offline offerings based on the requirements of the merchant. PhonePe claims to have over 150 Mn users and provides them with its “super-app”, which integrates 25 large digital apps including Goibibo and OYO.
In March 2019, Flipkart gave in-principle approval to PhonePe to operate as a separate entity. It can now set up an independent board and raise fresh funding from external investors. It was also speculated that the digital payments company plans to raise up to $1 Bn in external capital.
As PhonePe aims for bigger wins, the war in the digital payments space is also about to get bigger and better.
In terms of the WhatsApp payments, which was expected to be launched in May 2018, the plan got stuck with the requirements of data localisation. However, with a user base of 400 Mn in India, the company is looking to launch payments services in next 3-6 months.
In May, Google Pay recorded more than 240 Mn transactions taking the leading position in UPI transactions volume for June. Paytm had clocked 200 Mn transactions and PhonePe was second with 230 Mn.
According to NITI Aayog’s “Digital Payments (2018 edition)”, India’s digital payments industry is estimated to grow to $1 Tn by 2023. It also suggested that the value of digital payments will likely jump from the current 10% to over 25% by 2023.