Digital Payments now account for 60% of Amazon India's transactions

A little over a year after demonetisation, Amazon India says digital payments now account for over 60% of its total transactions as compared to less than 50% in 2016.
 
A large part of this growth is being driven by the Amazon Pay wallet, as balance loaded by customers grew 409% year-on-year on the back of aggressive incentives offered by the company. Amazon Pay wallet, which was launched in June 2017, now accounts for 48% of all digital transactions on the platform.
 
"We are now seeing 60% of transactions being done through online payment methods, across cards, net banking and use of Amazon Pay balance. Even in the remaining offline transactions, many customers are opting for our pay link options as well as PoS (point-of-sale) devices and cash reloads to the wallet," said Mahendra Nerurkar, newly-appointed chief executive of Amazon Pay.
 
As Amazon India steps up the focus on payments business, it has also shuffled the structure of the team. Former payments head Sriraman Jagannathan has taken up a larger role to lead financial services across Amazon India as the company looks to push digital payments to more customers and offer services based on their transaction data.
 
The move is similar to rival Flipkart, which recently appointed its chief technology officer Ravi Garikipati as the head of its financial technology department. Consumer-facing payments business is done through unit PhonePe, which competes with market leader Paytm.
 
Nerurkar was appointed the head of Amazon Pay with effect from December 1, 2017, as per filings with the ministry of corporate affairs (MCA), and will report to India head Amit Agarwal. He has been with Amazon since 2009, and was also part of Amazon's launch of Junglee.com in India.
 
"For reasons to balance short-term growth with the long-term strategy of Amazon Pay, Mahendra Nerurkar will be the new CEO while Sriraman Jagannathan, vice-president, will continue to lead the board of Amazon Pay with a specific focus on long-term strategy and new initiatives," the company said in a statement. All of Amazon's payment and financial services are clubbed under the entity Amazon Pay India.
Amazon Pay is also set to launch UPI support, which is currently in a beta stage. Amazon is also aggressively using its wallet instrument on third-party merchant sites across food, travel, movie tickets and mobile recharges and bill payments.
 
The company has tied up with merchants such as BookMyShow, FreshMenu, redBus, Housejoy, Yatra and Haptik where customers can use Amazon Pay.
 
"In contrast to our US customers, who mainly use Amazon payments for other e-commerce purchases, in India, customers are largely using Amazon Pay for bill payments, mobile recharges and for movies and food," Nerurkar said.
 
Third-party tie-ups bring revenues through transaction fees. Amazon Pay made revenues of ₹4 crore in FY17, as per MCA filings. The company did not share what the estimated revenues for the current financial year will be.
 
However, the main channel of monetisation of such payment data of customers will be through offering financial services such as loans and insurance.
 
ET reported last month that Amazon is in talks to invest in lending startup Capital Float and use the latter's tech for customer financing. Flipkart is also in talks with several digital lending startups.
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