BENGALURU: The rapid adoption of digital payment platforms especially for utilities, peer-to-peer transactions as well as e-commerce has led to a massive spike in digital payments. Walmart-owned
fintech company PhonePe has seen its new user acquisitions swell by 50 per cent during the Covid-19 pandemic with a record 550 million transactions in June alone.
This figure is equivalent to the pre-lockdown levels in February, Karthik Raghupathy, VP Strategy & Business Development, PhonePe told The New Indian Express in an interaction. Transactions for July, he added, is estimated to be even higher than the pre-lockdown levels.
Excerpts:
Digital payments in India are on a rise. Has COVID-19 proved to be a catalyst?
The pandemic has certainly provided a push to digital transactions across the ecosystem. The simplicity, safety, and speed of UPI has made it a popular choice amongst Indians and has brought in millions of new digital payment users into the market.
During the lockdown months, the biggest spike was in recharges and bill payments and we also observed users helping their family members, friends and household staff do digital transactions on PhonePe. We also saw a significant spike in person-to-person payments as well as use cases like food, grocery and medicines, digital gold, online doctor consultations and online games. Grocery purchases at offline stores grew both in terms of volume as well as ticket size.
And, how are the other financial services shaping along?
In the last 6 months, we have launched several products in the insurance and mutual funds categories. In the mutual funds category, we launched Liquid Funds and Super Funds to build long term wealth for our users.
In addition to launching insurance for Covid-19, we also recently launched the Hospital Daily Cash insurance to take care of incidental expenses during hospitalization for any disease.
We will have a comprehensive insurance and mutual funds platform by the end of the year. During the lockdown, we introduced multiple innovative features such as “Home Delivery” in our Stores page and “Pay Now” which enables customers to make the payment from within the PhonePe app without the need for scanning any QR. Since the launch, we have seen a three-fold increase in activity and a 50 per cent rise in daily traffic.
Could you give a comparison of transactions during COVID and pre-COVID months?
During the lockdowns months, our new user acquisition numbers increased by 50% and digital payments were being adopted by users across age groups, income levels, and locations. Our transaction volume for June at over 550 million transactions was back to February 2020 levels (pre-lockdown) and our July activity is even higher than that.
As digital payments assume greater significance, what are your expectations from the regulators/ govt?
Digital payments are going through a purple patch for the past few years. The government and regulators have done a lot to promote digital payments and we look forward to the financial regulators and the government to unblock and fast-track some of the critical regulations and policies.
For instance, if we can get to a paperless, non-physical method of doing Know Your Customer (KYC) verification, the markets open up across payments, mutual funds, insurance and other financial services, it will give a huge boost to the entire digital payments ecosystem. It is time for a bunch of high-impact policy clearances to come in to remove the growth inhibitors.