Since the launch of the Unified Payment Interface (UPI) in April 2016, the Indian digital payment market has adopted this quick and efficient technology. It has reached a milestone of ₹1 trillion worth monthly transactions in December 2018.
Understanding this huge opportunity in the digital payment space, several globals is jumping into the UPI war. Companies like Google, Amazon, WhatsApp and Xiaomi has already launched their UPI payment services. Google introduced Google Pay, Amazon introduced Amazon Pay and WhatsApp also introduced integrated payment services.
Following this footprint, Tencent-owned WeChat is also launching a UPI-enabled separate app for payments. Several senior officials of Tencent Holdings comprising of Indian and Chinese executives met NPCI executives three weeks ago for obtaining a licence. However, neither NPCI nor Tencent has officially clarified any of the claims.
Tencent has partnered with Axis Bank, HDFC Bank and ICICI Bank to have its own UPI handle (@wechat). Some sources suggest that the app will be named the same as it is in China – WeChat Pay. Tencent has plans to launch the app by the end of May-June and is registering an Indian entity for providing services.
WeChat Pay is the second most popular payments app after Alipay in China. Last year it handled over 520 million active users. The reason behind WeChat Pay’s success in China is the popularity of WeChat which has more than 1 billion daily active users in the country. However, the scene in India is different. WeChat has struggled significantly to gain customer base in India but it is way behind WhatsApp.
Tencent’s mobile game PUBG is quite popular in India and this popularity can help WeChat Pay get initial traction. Since PUBG offers several in-app purchases, it could use WeChat Pay as a default payment option.
Reliance Jio is also joining the UPI-ecosystem, whereas Flipkart-owned PhonePe is already a leader in this space. The digital payment battle is more likely to become more expensive and interesting to watch.