After setting up a successful advertising and logistics unit, Flipkart has shift attention to digital payment platform. The ecommerce leader is gearing up to launch its independent online payment solution arm in a few weeks.
The ecommerce leader is developing a multichannel solution, which will include a standard online payment gateway, semi-closed digital wallet and a service to pay without card or net-banking with the help of Unified Payments Interface (UPI).
The product is being developed by PhonePe, the mobile payments start-up, which was acquired by Flipkart in April. The etailer will invest Rs. 670 crore in the project over the next 3 years.
Flipkart’s CEO Binny Bansal said,
“This is a long-term strategic bet for us, and we believe PhonePe could become as big as Flipkart one day.”
Launching FreeCharge digital wallet can be regarded as one of the biggest turning points for Snapdeal. It gave the Kunal Bahl-owned company an edge over other marketplaces, Flipkart and Amazon.
Flipkart probably is hoping the same. The ecommerce firm led by the Bansals is struggling at this point. And an independent profitable arm in form of a digital payment platform may rescue the etailer from drowning.
Amazon and Shopclues too are planning to launch their own e-payments service.
Whether it is the government or ecommerce firms, all are dreaming about a ‘cashless’ economy. For etailers in particular, cash-on-delivery is a huge pain point. In fact, COD is said to be one of the reasons why Indian ecommerce industry hasn’t been able to reach its full potential.
But thanks to attractive deals and discounts offered by digital wallets and cash-back sites, online payment transactions have grown manifold compared to COD orders. That’s why in today’s time, ecommerce biggies are willing to invest crores in setting up their own platform.
“Building a payment business is not choice but a need today for large online businesses,” reiterated Sreedhar Prasad, Partner – Management Consulting at KPMG India.
Editor team is specialized in introducing the marketplace content targeting the Indian online sellers. They plan and coordinate to bring the appealing content for the small businesses on how to partner with the e-commerce sites like Amazon and Flipkart and strategies for improving their online business.
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