Some Payment Wallet Firm – Locked out of e-commerce Segment
Some of the payment wallet firm are of the opinion that they get locked out of the successful e-commerce segment since companies running marketplaces tend to prefer their own subsidiaries or are determined in ensuring that customers spend any cash-back money on their own sites.
Oxigen for instance has said that it is no longer available on one of the biggest shopping sites of India. According to CEO of Oxigen, Ankur Saxena has stated that they are presently on Snapdeal prior to acquiring Freecharge and have decided to take them down.
He further stated that at one point of time they accepted wallets but now they want to come up with their own wallets. Freecharge seems to be the only wallet option on Snapdeal that has also launched cash-back options which tends to direct consumers to the unit’s offerings. Freecharge was acquired by Snapdeal in April this year, for almost 2,400 crore.
Snapdeal had refrained from responding to queries and Flipkart informed that it would not comment on its wallet practices. Saxena had mentioned that the trend would hurt Oxigen and that there would be an impact on the business if the customers are unable to use the wallet on a particular site, they would be compelled to utilise another mechanism to process the payment.
Paytm – Its Own e-Commerce Platform
According to managing partner, Ashvin Parekh of Ashvin Parekh Advisory Services, stated that striking boundaries on the e-commerce evolution could be envisaged as a restrictive exercise and that they have still not achieved anything with regards to permeation of e-commerce.
Market leaderPaytm, though does not seem to be too worried. Vice President Products, Paytm, Nitin Misra had commented that they have better acceptability and more consumers. Why would customer put money in a wallet which can be used only on that particular site and the cash back too cannot be utilised elsewhere?According to him the consumers is not dumb and if someone does not intent to permit them as a payment option on their site it is entirely their choice.
Paytm has expanded to begin its own e-commerce platform and the government as well as the Reserve Bank of India have made financial presence significant, making for an ecosystem wherein payment wallets would play a role together with various other elements. However, what is serious for such companies is having a large subscriber base.
Several Banks Launched Own Wallets
Towards the last week of October, Vijay Shekhar Sharma, founder of Paytm had received a message from State Bank of India which was not good news. The message stated that the nation’s largest lender together with its associate banks would not permit their customers to load money onto the Paytm wallet from their accounts.
The reason provided to their query was that the net banking services were only for shopping and not for uploading wallets according to Sharma. After independent wallet companies have started operating in India and gained reputation, several of the banks launched their own wallets.
SBI in fact according to reports by The Economic Times, recently, even planned to launch a wallet for feature phone users known as Batua, by next month. Chairman of Payments Council of India and the managing director of ItzCash, Naveen Surya, had stated that some players would always think that they are big enough and that they have adequate customers. However as one tends to go deeper and begin running independently the payment business, when it is separated from the core business, one would realize that it is difficult to create scale.