PhonePe, the fintech unicorn, has officially launched its payment gateway as it seeks to expand into larger offline and online shops, including small and medium companies. With this introduction, the fintech firm no longer needs to rely on third-party payment gateways for in-app payments.
The latest offering pits the Walmart-backed digital payments app against Paytm and Pine Labs, which have a strong offline presence, as well as Razorpay and Cashfree Payments, which have a strong online presence.
Paytm, another payment app and PhonePe's rival launched its own gateway in 2012.
Meanwhile, other firms in the industry are considering an omnichannel strategy and offering gateway services to both online and offline shops. Pine Labs, the offline leader and point-of-sale payment provider, debuted Plural, its own online payment gateway, while Mswipe will do the same soon. Razorpay, on the other hand, acquired Ezetap last year in order to expand into the offline market.
However, the corporation does not provide exact data on traction or targets.
The payment gateway service is the newest addition to PhonePe's suite of services for its 450 million registered users, which includes offline merchants. This comprises wealth management, financing, stockbroking, a shopping app (Pincode) based on the Open Network For Digital Commerce (ONDC), and account aggregation.
PhonePe has received preliminary clearance for payment aggregator services and is awaiting RBI certification. It announced last week the debut of account aggregator services via its wholly-owned subsidiary, PhonePe Technology Services.
Currently, payment gateway (PG) services are provided at no cost. The company claims to have digitised over 35 million offline merchants in Tier II, III, IV, and beyond, covering 99 per cent of the country's pin codes.