With over 80 million Unified Payments Interface (UPI) users, Amazon Pay, the payments business of e-commerce giant Amazon, has been growing at 40-50 per cent year-on-year (Y-o-Y), said Mahendra Nerurkar, chief executive officer (CEO) and vice-president (V-P), Amazon Pay India.
“Leveraging just the micro peer-to-peer (P2P) transactions on UPI is not a business model.
"While we have enabled those features, we do not chase monthly active users based on this.
"Our focus has been on peer-to-merchant (P2M) and we do see benefits in what we have been offering.
"The growth is in terms of users, transactions, payment volume, and revenue. We are seeing pretty strong growth and it’s in the range of 40-50 per cent Y-o-Y,” he told Business Standard.
Amazon Pay, which is the sixth largest player in the payments segment, had a total transaction volume of 57.6 million in July, according to the National Payments Corporation of India (NPCI) website.
Other than UPI payments, Amazon Pay also has products such as Amazon Pay Balance, which gives services like scan & pay transaction via UPI, money transfer and cash deposit at doorstep.
“Our user base in this segment is 50 million. India still has a large segment of people, who prefer payment by cash.
"Over a period of time, we have seen these customers have no aversion to going digital but the barrier to go digital is very high.
"For instance, we have built a cash-deposit at doorstep service.
"Any time a user takes an Amazon delivery, he can also deposit cash into the Amazon Pay Balance (wallet).
"We have been all along embracing all the innovations, which NPCI has been coming out with.
"This Amazon Pay Balance is now interoperable with UPI,” added Nerurkar.
Similarly, Amazon Pay has seen the fastest growth in its credit card business, which it offers with ICICI Bank.
The user base is over 4 million and growing fast.
“Our idea is to make the use of credit cards easy to understand.
"So, for all transactions like ticket booking and hotels, among others, users get straight 5 per cent rewards on Amazon.
"For billing services, users get 2 per cent rewards.
"This has been a pretty popular proposition,” he added.
The other successful segment has been the Amazon Pay Later, which has 8 million sign-ups.
“We see these categories growing strong.
"We do see this trend persisting.
"We see potential to go deeper into customer wallet share and also believe we can increase our customer base,” he added.
When asked if Amazon Pay would like to follow the footsteps of its competitor Phone Pe, which chose to move away from the parent company, Nerurkar said current operations are completely separate from the ecommerce business.
“We see a strong trend and the payments business is becoming sustainable by itself.
"We are an independent company. We have an independent board, and leadership.
"Today, 2/3rds of the transactions which happen on Amazon payments apps are non-shopping transactions,” he said.
On specifically wanting to be a pure-play fintech player, he added, “With some innovations coming out, we have long held the view that we can create a separate app whenever we want.
"But being a part of the same experience allows the customer to experience things in a different way.”
Nerurkar wants to focus on building resiliency in the system.
He said, “We want to focus on systems where payments never fail, they are fast and transactions are safe.
"For this, we need support by a cost structure, which is sustainable in the long term.
"Our focus will be on how to make this more sustainable and scalable to reach the next 50 million or 100 million users.”
He was also confident that the industry will see a lot of innovation in terms of making last mile micro payments convenient.
“This is going to be a big focus for us. Credit on UPI is a big enabler,” he added.
