[AMG Power]

An Indian parliamentary panel has urged the government to support the growth of domestic fintech players that can provide alternatives to the Walmart-backed PhonePe and Google Pay apps that currently command more than 83% of the country’s fast-growing digital payments market.

PhonePe commanded 46.91% of the UPI market share by volume during the period of October to November 2023, the parliamentary committee on communications and IT wrote in its report. Google Pay held a market share of 36.39% during the same period, the report said.

The National Payments Corporation of India, a special unit of the Indian central bank RBI, has previously expressed similar concerns about the clear duopoly in the mobile payments market in the South Asian market. It had earlier proposed enforcing a check on the market share for players, ensuring that no single player shall process more than 30% of the UPI transactions in a month.

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[GTO]

This is why I say, discipline PayTM, fire its CEO, impose a stiff fine on them and enforce regular checks & balances...but don't kill PayTM. PayTM will solve the compliance issues (hopefully), but the bodyblow to its reputation will stay for a long time to come. When it comes to money, once you lose the trust of Indians, its hard to gain it back.

That being said, many industries have a duopoly and it's tough to change. OS (Windows + Apple), Phone OS (Android & Apple), colas (Pepsi & Coke), planes (Airbus & Boeing), e-commerce (Amazon + Flipkart)...

[Hayek]

Without getting into the merits of the case, PayTM is 45% owned by FDI investors (including 20% economic interest with ANT Financial of China), and 18% owned by FPIs. Vijay Shekar Sharma is technically just the CEO who can be fired at any time.

Don’t see why we treat it differently from Google or PhonePe. For that matter, HDFC Bank is 68% owned by foreigners. For me, all of these companies are regulated by Indian Regulators, and it is for users to decide which company they want to give their business to, as long as they comply with relevant regulations.

UPI is an open access system - which has won plaudits from around the world. Google Pay and Phone Pe have won market share in a world where you can make UPI payments on every bank’s app, WhatsApp, Amazon Pay, PayTM, BharatPe, and plenty of other apps. There is no entry barrier or switching cost at the payment origination end. Time for our parliamentary committees to focus on more important issues than which Apps won in an open market place.

[CarNerd]

It's like BSNL complaining about Airtel and Jio!
Who is stopping BHIM from competing with Google Pay and Phone Pe? The job of govt is to check for any irregularities and take action like it did against PayTM and not to be jealous that others are providing better service than it. Ease, speed and success rate of UPI apps decide their popularity. If govt curbs the transactions of these two brands, people will suffer because of failed transactions.

I heard that govt had launched its own food delivery app to compete with Swiggy/Zomato and Cab rental app to compete with Uber/Ola, what happened to those? It seems govt is not interested in competing, it's only interested in curbing.

[SilentEngine]

Originally Posted by CarNerd

It's like BSNL complaining about Airtel and Jio!
Who is stopping BHIM from competing with Google Pay and Phone Pe? …

Right! Just the other day I was trying to install BHIM app on iPhone, and guess what, app won’t work if I don’t have latest iOS. What a silly restriction!

[AMG Power]

Don't know if its an attempt to curb Google pay, but of late have noticed that Google pay doesnt work during peak hour - lunch time, evening commute for Uber, morning commutes too making it effectively redundant.

The app says its a problem with the bank server, but what use is a payment mode if it doesnt work. Maybe its the Govt’s silent way of making customers move to other avenues of payment.

Have stopped trusting Google’s infallibility and it has become quite an unreliable mode for me as of now. Outlets also inform that Google pay doesnt work during peak hours quoting network issues.

[MT_Hyderabad]

Capping not more than 30% UPI transaction for Gpay is unlawful. It is like saying that Hyundai cannot sell more than 30% cars of the market share!

If the quality is good, people like it, then why not?

[gauravanekar]

Off tangent / off topic:

During this fiasco I started looking for good UPI app to replace my BHIM/Paytm combo. I have been using BHIM primarily and Paytm as backup.

Problem: I listen to podcasts and Youtube videos a lot, especially when I am out to get some shopping or walking, everytime the QR code scanning screen is opened the audio is paused, this always annoyed me.

Self imposed constraint: I didnt want to use Gpay (because its google), Phonepay (no particular reason other than the fact that I didnt want to follow the crowd).

Solution: This mutual fund app called 'Groww' has UPI feature, the app is slick and fast. I havent even completed KYC for their main business but the UPI still works, It doesnt affect the audio stream as well.

[Ravi Parwan]

By this logic, government should also act against Maruti, as it held more than 50% market share in Indian auto market for so long and still has 40%.

They should also censure Jio with 38% market share.

What about IRCTC???

Seems they do not believe in the concept of free market.

[Adsc0230]

These days most of the primary banks (at least the private players such as Axis, ICICI, HDFC and Kotak etc.) offer all UPI features on their Mobile apps.

You can consider me old school, but given there are hardly any rewards offered from PhonePe or GPay, what's the incentive for an individual to use 3rd party UPI apps when your own bank offers the same? I have been using Axis bank and Kotak bank apps and UPI payments work fine. If there is a problem with a UPI transaction, you can directly go to your bank rather than contact 3rd parties.

Can someone please explain the benefits of using PhonePe, GPay or PayTM in today's scenario?

[careind]

The government can encourage competition but I don’t think they can restrict people.
It is ultimately the people who choose which app to pay with and obviously they think the above two are better.

What the government has to do is to bring in or encourage more apps that are easier to use.

But the biggest concern is security. Google has ( I believe ) Cutting edge security that would safeguard out privacy to the best extent possible against present competitors or even desi app developers who may not be that matured. They do have an image to protect!

[mygodbole]

Originally Posted by gauravanekar

Off tangent / off topic:

I havent even completed KYC for their main business but the UPI still works, It doesnt affect the audio stream as well.

Isn't that the root of the problem? Non-KYC compliant customer can access the service? Why lock the door after the horses and the cows have bolted?

Drive safe

[binand]

Originally Posted by AMG Power

An Indian parliamentary panel has urged the government to support the growth of domestic fintech players that can provide alternatives to the Walmart-backed PhonePe and Google Pay apps that currently command more than 83% of the country’s fast-growing digital payments market.

At least for once the big G is seeing a problem before it becomes a big problem. The Google-PhonePe duopoly needs to be curbed.

One reason we get locked into a specific UPI PSP (the term used for the software provider) is that VPAs are not portable. If NPCI implements portable VPAs at least some of the pain points of switching will be addressed.

Second is the switching cost - reconfiguring all the payees, recurring payments and BBPS setups in the new client.

As someone who moved away from Google Pay to BHIM - apart from these two issues, switching was rather painless. I like the simplicity of the BHIM app. Google Pay was a UX disaster for me.

We could start insisting that Google not include their app by default in Android phones sold in the country. That itself should level the paying field a lot.

Originally Posted by careind

Google has ( I believe ) Cutting edge security that would safeguard out privacy to the best extent possible against present competitors or even desi app developers who may not be that matured. They do have an image to protect!

News to me that Google has an image of a company that safeguards its users' privacy. As far as I'm concerned, they built their ~$2T company by playing fast and loose with the most intimate and private information of their users they were privy to.

[Chetan_Rao]

Originally Posted by careind

...

But the biggest concern is security. Google has ( I believe ) Cutting edge security that would safeguard out privacy to the best extent possible against present competitors or even desi app developers who may not be that matured. They do have an image to protect!

Google is probably the one entity that brazenly collects details about its users that even the most intrusive governments would trade their own left arm (or right, am ambidextrous and democratic when it comes to arm-biting) to get.

The only difference is what the two entities use it for (even these often converge), and how nice (or not) they're willing to be about it.

[subie_socal]

Originally Posted by SilentEngine

Right! Just the other day I was trying to install BHIM app on iPhone, and guess what, app won’t work if I don’t have latest iOS. What a silly restriction!

That's iOS problem, not the app's fault.