Zomato UPI Pauses User Onboarding

Listed foodtech startup Zomato has reportedly paused onboarding new users on its UPI payments vertical, Zomato UPI.

According to sources cited in an ET report, the sign-up option for Zomato UPI has been disabled for the past few weeks. For now, the UPI option does not show up in the Zomato app for users who did not sign up for it before the temporary suspension.

Zomato has partnered with ICICI Bank to offer UPI payment services. The foodtech confirmed the development, adding that it is still available to users who were already using it. According to a Zomato spokesperson, the UPI feature has been paused to incorporate feedback received on the onboarding flow.

“We will start enrolling new users by the end of the month,” the Zomato spokesperson added.

Launched in May as a UPI service for peer-to-peer (P2P) and merchant transactions, Zomato UPI was said to have been launched to allow users on its platforms to make payments without the need to switch apps.

Alongside paying for online food and grocery orders on Zomato and Blinkit, the listed foodtech also offers customers the option to pay at some restaurants listed on Zomato using various options such as cards, net banking and UPI via Zomato Pay.

The listed foodtech had set up Zomato Payments in August 2021 to offer digital payment solutions such as wallets and payment gateway services. Zomato also sells gift cards on its app, allowing users to buy and send the said gift cards. During the calendar year 2022, Zomato had 58 Mn annual transacting customers for food orders, up from 49.5 Mn in 2021.

The foodtech giant could be looking at leveraging the huge traffic flow through its systems to spur online payments in a big way. In 2022, Zomato had 5.8 Cr annual transacting users, while it processed a gross merchandise value (GMV) of more than $2.8 Bn during FY22.

The listed foodtech’s move comes as many other tech startups have been looking to launch their own UPI service, including the likes of ecommerce giant Flipkart.

Zomato’s move to launch its own UPI offering had come at a time when the National Payments Corporation of India (NPCI) has been looking to add more players to the ecosystem. For now, the UPI ecosystem continues to be dominated by three players – PhonePe, Google Pay and Paytm – which account for more than 95% of all UPI traffic regularly.

Zomato continues its resurgence on the bourses, soaring 6% on intraday trading on Thursday (July 13) to hit a 52-week high of INR 84.50 apiece.

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