india, mobile payment, mobikwik, net1, mvc, paytm, idfc spice, transerv PayNXT360

Indian mobile payment industry’s strong growth and huge consumer base is attracting significant investments

With rise in mobile phone and internet usage in India, mobile payments are increasingly popular in the market. With approximately 900 million mobile subscriptions, consumers are making online purchases and bill payments through mobile. Penetration rate of mobile payment apps similar across towns but usage rate is higher in smaller towns. Popular mobile payment apps include Paytm, Freecharge and Mobikwik. According to PayNXT360, Indian mobile payment market is expected to record a CAGR of over 50% during the next five years. Hence investors are attracted to Indian mobile payment segment due to its favorable growth rate and regulations.

Gurgaon based digital wallet platform MobiKwik has received USD 40 million strategic investment from South African mobile payment service provider Net1. As part of the deal, Net1’s mobile virtual card (MVC) technology will be integrated with MobiKwik to provide wider range of payment methods to its one million merchant bases. The investment is likely to fuel MobiKwik’s aim to increase customer base from 32 million to 150 million in next 3 years and merchant base by another half million. The company also plans to increase gross merchandise value of offline transactions to 50% by 2017. Hence two new offline payment technologies, app generated PIN and quick response (QR) code will be making their way into the market.
Recently, mobile payment and commerce platform Paytm announced that it has bagged an investment from Mountain Capital which it plans to use for upgrading existing payment methods and launch Paytm Payments Bank that is under proposal phase.
Digital Payment Company, TranServ bagged investment of USD 15 million through series C funding led by domestic venture capital fund, IDFC SPICE Fund managed by IDFC Asset Management Company and Micromax Informatics. TransServ plans to utilize funds towards business growth and service line expansion. The partnership will boost mobile payment facility for Micromax customers and increase user base for Transerv. The digital payment platform had ventured into corporate segment earlier this year with small value employee payment service via Udio app and plans to increase its market share to 35% by end of 2016.

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