DELHI: Amazon Pay, the ecommerce giant’s digital wallet service, has entered into competition with Flipkart and Paytm’s payment options, amid stellar growth in payment services in India.
Unlike the gift card option that the company had provided previously, a customer can now load money into Amazon Pay, which will automatically go into the wallet account, described as ‘Money’ on the app, the Economic Times reports.
The company, commenting on the move, said it is focussed on both customer needs and innovation to “ensure that customers have a trusted and convenient payment experience.
“We are leveraging our PPI (prepaid payment instrument) license received from RBI while we continue to partner with Qwikcilver to offer various digital gifting and payments solutions."
The system will be more efficient than the previous iteration, which involved banks and third-party payment systems. Many of these options, the Economic Times says, result in a failure rate of up to 30%. In contrast, the new wallet will bypass bank authentications.
For internet companies in the country, payment technology is key, due to poor data speeds. Amazon recently invested heavily into its payment system. In addition, it has bolstered demand through its ongoing Independence Day sale, during which digital wallet users are entitled to additional cashback deals.
According to Zeebiz, the sale has spurred a twenty-fold growth in top ups during the ‘Great Indian sale’. Manish Tiwary, Vice President - Category Management, Amazon India, said that “with Prime continuing to be our top selling product and Amazon Pay seeing 20X growth in top ups, customers continue to vote for the trust and convenience of shopping on Amazon.in”.
Digital transactions have quadrupled in India, since the Prime Minister, Narendra Modi, announced the withdrawal of 90% of banknotes from circulation next year.
Speaking to CNBC, Paytm CFO Madhur Deora noted the massive increase in demand for his platform post-demonetisation. Before the withdrawal in November 2016, he said, “we had 700 thousand merchants. Post-demonetization, we upped it and then we started signing up to 40-50 thousand merchants every day," he said.
Data sourced from The Economic Times, ZeeBiz, CNBC; additional content by WARC staff