E-comm players move battle to m-wallets
NEW DELHI: Kunal Bahl, co-founder and CEO of Snapdeal, once said that an e-commerce business without a wallet is like cars without wheels.
So, Snapdeal bought Freecharge, and started its own wallet. Now, 10% of Snapdeal’s transactions happen through Freecharge. Wallet users get discounts and cashbacks that can be used for future purchases.
Mobile wallets have burgeoned in the past one year. By the end of 2015 they numbered at 250 million.
With Flipkart and Amazon poised to enter the game, the line between wallet companies and e-commerce firms is blurring.
A source at Amazon said that for a market like India, having a wallet is must.
Market leader Paytm, which has 120 million wallets, is also leaving no stone unturned. Paytm has created a marketplace that competes with Flipkart, Amazon and Snapdeal around its wallet.
“About 63-65% of the payments happen through our wallet, and users get cashbacks,” said Vijay Shekhar Sharma, founder and CEO, Paytm.
Freecharge has 20 million wallets. “The game in the digital payments has just begun. One who expands the most will gain the most,” said Govind Rajan, COO at Freecharge, which is adding a million users every week.
One way to do that is reducing transaction time, which is around 10 seconds now. “The ideal will be to bring it down to 5 seconds,” he said. “Tomorrow we might do it through speech recognition.”
But, as far as e-commerce is concerned, Bipin Preet Singh, founder and CEO of Mobikwik, claims to be in the lead. “If e-commerce companies are using anything outside their own wallet it is Mobikwik,” he said. Mobikwik has 30 million wallets.
But, the fight is not limited to the online world. Rajan plans to go after offline merchants also Internal target is to reach to 250,000 merchants in six months
Mobikwik already has 10,000 offline merchants. It has also partnered with other wallets such as Citrus and Payu. “The same will happen with Flipkart and Amazon,” Singh said.
Paytm claims to have 100,000 locations. If Flipkart and Amazon too go after the offline world, the market will heat up further.
Wait: there are banks, too. State Bank of India has Buddy, Citibank has Masterpass, ICICI Bank calls its wallet Pockets. HDFC Bank and Axis Bank too operate wallets But, with venture capital money going to wallet companies, the banks seem to be lagging.