PhonePe has launched its own payment gateway which will serve MSME (Micro, Small, and Medium Enterprises) merchants across the country.
“PhonePe is already a market leader in UPI with over 50% market share by value.
The company’s ability to handle large-scale transactions and the strong consumer trust in the platform have translated into PhonePe launching its Payment Gateway business to provide the best-in-class payment experience to consumers and merchants alike,” the company said in a statement.
Range of services
A payment gateway is a technology provided by third-party platforms that ensures the secure transfer of money from the customer’s bank account to the merchant’s payment portal.
This is the latest product offering in addition to its range of services it offers to its 450 million-strong registered user base, including wealth management, lending, stockbroking, Open Network For Digital Commerce (ONDC)-based shopping app (Pincode), and account aggregation.
Reliance on external gateways
PhonePe has been relying on external payment gateways to process payments on its app
With this launch, the fintech firm no longer has to depend on external gateways for its in-app payments.
The company intends to tap into larger offline and online merchants, including small and medium businesses.
Features
The company also assured, “The PhonePe Payment Gateway is reliable and ensures 100 percent uptime for merchants and comes with industry-best success rates.
It proactively detects downtimes and ensures stable success rates of transactions with real-time instrument health-tracking capability.”
It also complies with RBI Laws to securely store customers’ tokenized cards in the PhonePe Card Vault after taking consumer consent.
Initial free onboarding
The company is currently allowing new merchants to onboard for free.
This is an initial offer while most payment gateways charge a standard transaction fee of 2 percent.
“While most PGs charge a standard transaction fee of 2%, PhonePe has a special offer for new merchants to onboard for free, with no hidden charges, setup fees, or annual maintenance fees,” the company said in a statement.
Competition
It competes with Razorpay, Cashfree, CCAvenue, Pine Labs, and PayU. One97 Communications Limited, the parent company of Paytm which also launched its own payment gateway in 2012.
Offline leader Pine Labs launched its own online payment gateway, Plural, while Mswipe will launch something similar soon.
Online gateway provider Razorpay acquired Ezetap last year to venture into the offline category.
