Snapdeal, Paytm set for a face-off to win a big share in India’s growing bill payment market
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Propelled by growing Internet penetration, growth in e-commerce and the ease of online payments, India’s Rs 7.4-lakh crore bill payments market has caught attention of Snapdeal and Paytm , the two biggest consumer Internet companies in the country.
An Economic Times report has revealed that while Paytm was among the first domestic Internet companies to offer digital bill and utility payment services, Snapdeal, the country’s largest e-tailer, is making a concerted effort to catch up through its $450 million (Rs 2,900 crore) acquisition in April of mobile recharge firmFreecharge .
As the number of people using credit cards and debit cards have surged, digital payments have emerged as a crucial front. And Delhi-based Snapdeal has hinted at its ambition to build a services platform in order to create its niche in a crowding online marketplace arena.
As per the ReserveBank of India (RBI), less than 1% of the 30 billion bill and utility payments handled every year – at an estimated value of at least Rs 7.4 lakh crore – are done electronically.
The financial daily stated, “While banks dominate the market for electronic payments relating to phone, Internet, water, gas and electricity bills and eveninsurance premiums, among other things, Snapdeal and Paytm have built up a war-chest to back their services businesses, being among the most heavily-backed domestic consumer Internet companies.”
Japanese investor SoftBank , eBay and BlackRock fall in the list of Snapdeal’s backers. On the other hand, Paytm has received a $575-million capital commitment from Ant Financial, the Jack Ma-controlled affiliate of the Chinese ecommerce giant Alibaba Group .
Expressing views on the attractive electronic bill and utility payments sector, Shankar Nath, senior vice-president at Paytm, told ET, “It’s a high-volume and hightransaction business. Payments are upfront, and there is no cash-on-delivery involved.”
At present, both Paytm and Freecharge are known more for their mobile and direct-to-home (DTH) recharge platforms. Paytm handles about 50 million mobile and DTH recharge transactions a month, and according to Nath, 7-8% of its customers have begun to pay their bills online.
On the other hand, Kunal Shah, founder and chief executive of Freecharge, asserted that the eCommerce website owned by Snapdeal has at least 25 million customers for mobile and DTH recharge. He also admitted that the bill payments service is a massive opportunity to gain customers. “This is a huge opportunity to cross-pollinate customers. Get utilities on board, and provide a complete set of services,” Shah told the financial daily. (Image: Thinkstock)
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An Economic Times report has revealed that while Paytm was among the first domestic Internet companies to offer digital bill and utility payment services, Snapdeal, the country’s largest e-tailer, is making a concerted effort to catch up through its $450 million (Rs 2,900 crore) acquisition in April of mobile recharge firm
As the number of people using credit cards and debit cards have surged, digital payments have emerged as a crucial front. And Delhi-based Snapdeal has hinted at its ambition to build a services platform in order to create its niche in a crowding online marketplace arena.
As per the Reserve
The financial daily stated, “While banks dominate the market for electronic payments relating to phone, Internet, water, gas and electricity bills and even
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Expressing views on the attractive electronic bill and utility payments sector, Shankar Nath, senior vice-president at Paytm, told ET, “It’s a high-volume and hightransaction business. Payments are upfront, and there is no cash-on-delivery involved.”
At present, both Paytm and Freecharge are known more for their mobile and direct-to-home (DTH) recharge platforms. Paytm handles about 50 million mobile and DTH recharge transactions a month, and according to Nath, 7-8% of its customers have begun to pay their bills online.
On the other hand, Kunal Shah, founder and chief executive of Freecharge, asserted that the eCommerce website owned by Snapdeal has at least 25 million customers for mobile and DTH recharge. He also admitted that the bill payments service is a massive opportunity to gain customers. “This is a huge opportunity to cross-pollinate customers. Get utilities on board, and provide a complete set of services,” Shah told the financial daily. (Image: Thinkstock)
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