Ease of doing business for MSMEs: According to the company, the free services could help merchants — who have a monthly sales volume of Rs 1 crore — save up to Rs 8 lakhs and potentially around Rs 2 lakh per month with zero onboarding costs.
Ease of doing business for MSMEs: Entering the payment gateway services market in India, digital payments company PhonePe on Wednesday officially launched the PhonePe Payment Gateway with a special limited-period offer for new MSME merchants. Joining the club of existing payment gateways in the country viz., Paytm, Razorpay, PayU, Pine Labs, CCAvenue, Bill Desk, CashFree and more, PhonePe said it is offering free onboarding to new merchants with no hidden charges, setup fees, or annual maintenance fees while most payment gateways charge a standard transaction fee of 2 per cent.
According to the company, the free services could help merchants — who have a monthly sales volume of Rs 1 crore — save up to Rs 8 lakhs and potentially around Rs 2 lakh per month with zero onboarding costs.
“PhonePe is already a market leader in UPI with over 50 per cent 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.
The company’s payment gateway offers a no-code setup for integration across all platforms and helps merchants accept online payments across Android, iOS, mobile web, and desktop.
PhonePe’s arch-rival Paytm had launched its payment gateway back in 2012 and in 2020 had launched an all-in-one payment gateway for SMEs to collect digital payments across all payment methods without the need for any website or app. The company doesn’t charge payment gateway set-up fee or annual maintenance fees.
According to PhonePe, it has digitized more than 3.5 crore offline merchants and has more than 46 crore registered users.
The payment gateways in India are likely to nearly triple in market size in the next seven years with a compound annual growth rate of 16.2 per cent from around $4.79 billion in 2023 to $13.68 billion in 2030, according to data platform Statista.
Earlier this month, PhonePe had announced the launch of its Account Aggregator (AA) services for customers to give consent to sharing of all their financial data, such as bank statements, insurance policies and tax filings with regulated financial institutions for several use cases such as applying for loans, buying new insurance, getting investment advice, etc.
The two announcements on payment gateway and account aggregator services come weeks after the company had $100 million investment from General Atlantic as part of a larger fundraise, bringing the total investment to $550 million from General Atlantic and its co-investors.