Amazon Rapidly Scaling Up Its E-payments, Financial Services In India

Amazon Pay, the digital payment arm of the e-commerce giant, is rapidly scaling up its e-payments, credit and financial services across the country. The firm is speedily making inroads into India’s booming digital payment market including tier-2 and 3 cities and towns, where it is witnessing very strong growth and competing with Walmart-owned PhonePe, Alibaba-backed Paytm, and Google Pay.

Amazon Pay UPI (Unified Payments Interface) has recently added 5 crore customers in India. Amazon Pay is offering daily rewards through the company’s month-long festive sale event Great Indian Festival to all customers using Amazon Pay UPI for shopping, paying bills, paying at online merchants, and sending money to their contacts. Customers are using the Amazon app to pay at 2 crore local shops by simply scanning any UPI QR (quick response) code. In the last year, over 75 per cent of its customers using Amazon UPI have come from tier 2 and 3 cities.

“At Amazon Pay we are working on a number of innovations that are majorly focused on three axis. Firstly, how to make underlying payment rails more secure, resilient, and fast,” said Mahendra Nerurkar, CEO and VP, Amazon Pay, in an interview. “The second area is to make digital payments convenient for customers by simplifying complex experiences like real-time KYC (know your customer) or real-time credit check. The third area, where we plan to make a big difference would be to reach out to people who are cash habitual and are new to getting access to credit.”

Nerurkar said about 85 per cent of the country’s population still earns in cash and only 2-3 per cent have credit cards.

The firm is scaling up its credit services with Amazon Pay Later. The company said it is the largest and first-of-its-kind product that allows users to pay next month along with EMI (equated monthly instalment) option. Amazon Pay Later has received 2 million customer sign-ups. In a year since its launch, the platform has recorded 10 million transactions at 99.9 per cent Payment Success Rate.

Amazon Pay ICICI Bank Credit Card offers customers rewards on Amazon and everywhere else they shop. The company said it has emerged as the fastest co-branded credit card to reach 2 million customers with one million cards issued in the last nine months. It is the single largest portfolio of contactless cards enabled by VISA today and sees the highest adoption of this feature for a portfolio of its size. Over 80 per cent of the new customers are availing this card completely digitally, without any physical interaction. Customers can conveniently apply for it online and receive it instantly with a digital KYC (know your customer) that takes less than 60 seconds.

The firm has leveraged its logistics fleet to help customers load cash into their wallets at their doorstep.“I really feel very excited about the ‘load cash at doorstep’ product,” said Nerurkar. “It is serving the largest segment of cash customers. And there, we do see definitely higher adoption in tier-2 and 3 towns.”

Amazon is also expanding its financial services portfolio. Amazon Pay India recently announced its collaboration with investment platform Kuvera.in. This would facilitate customers to invest in mutual funds, fixed deposits, and even more with time. The platform is also offering two and four-wheeler insurance policies, in partnership with Acko General Insurance Ltd. Customers can purchase insurance in less than two minutes.

Amazon is also making several fintech investments in the country where partners are enabling innovations and serving the company’s core strategic goals. It has backed Capital Float, ToneTag (harnessing the power of sound through soundwave technology), and BankBazaar (an online marketplace for financial products)

“We offer digital gold which is our first investment product along with other microinsurance products,” said Nerurkar.

Amazon Pay is also enabling SMBs (small and medium businesses) to be a part of the formal economy. It offers the ability to accept digital payments, strengthen a merchant’s digital footprint and scale up their business. It reduces dependence on cash management (think of tendering exact change). The platform now has over 6.5 million merchants onboarded as Amazon Pay merchants across more than 350 cities and towns.

“Over the last six months, the offline merchant population in particular for us has grown tremendously,” said Nerurkar.

The platform also has the “Amazon Pay For Business” mobile app to allow simplify merchants’ journey for accepting digital payments. Available on Android, the app can be used by small and medium businesses across the country to register themselves, generate a unique QR code and start accepting digital payments within minutes. Customers can use any UPI app to scan the Amazon QR and make payments to these businesses.

Amazon Pay also launched a voice notification feature for the ‘Amazon Pay for Business’ app in English and Hindi. Small businesses across India can get a hassle-free experience eradicating the additional minutes spent during peak business hours waiting for notification for payments received through this feature. Apart from these programmes, the firm said it also offers loans to its sellers with low-interest rates.

Amazon Pay is facilitating affordability and provides several offers during Amazon Great Indian Festival. During the month-long Great Indian Festival (GIF) 2021, customers can experience several unique affordability propositions across categories. Customers save up to Rs 5,000 during GIF by making daily payments like sending money, paying bills and booking tickets to unlock shopping rewards that can be redeemed during this phase.

They can also get offers from leading partner banks, no-cost EMI on debit and credit cards, Bajaj Finserv Amazon Pay Later and offers from other leading credit and debit cards. To help its customers maximize their budget, Amazon Pay Later provides an instant credit of up to Rs. 60,000.

“The fact that we are going after a much larger set of banks who are offering their discounts and offers on the site, just allows more customers to participate,” said Nerurkar.

Amazon said it is working diligently towards simplifying and democratizing digital payments in the country. “Overall, I really feel excited and proud of how much we have been able to move (regarding) the ability to include a very wide array of customers in the online shopping festival,” said Nerurkar.

Customers can use the ‘Speak to Shop’ feature on the Amazon shopping app or just ask Alexa on their Amazon Shopping app (Android only) as well, to pay utility bills, load money in Amazon Pay, or navigate to the Small Business Store or the Fun Zone.

“If you just think about Amazon Pay balance, the ability for us to get cash customers to participate in the digital sale is really incredible,” said Nerurkar. “We're able to get customers to load cash at their doorstep across 99 per cent pin codes in India and help them participate in this digital festival.”