Flipkart buys PhonePe Hoping to Rival Paytm & Snapdeal
India's very own e-commerce giant Flipkart has recently acquired Bangalore-based mobile payments company PhonePe, its third acquisition in the payments solutions space.
The news comes as a surprise since Flipkart has been testing its pilot wallet system, called Flipkart Money last month.
PhonePe will function as an independent business unit, according to a statement from Flipkart. According to unverified sources, the deal would have cost Flipckart around 10-20 million USD. PhonePe would be a direct rival to its competition Snapdeal's acquisition of Freecharge which is now expanding to pay DTH payments, mobile recharge payments and other shopping websites. However even Snapdeal's attempts to enter the mobile payment platform and offer a wallet absed solution has no match to the giant Paytm, one of the pioneers of the system. Paytm was one of the 11 applicants that received RBI's in-principle approval to get a payments bank licence last year.
PhonePe is said to work on the same principal as other wallets. Users will have a unique pin to share with others or on untrustworthy websites, thus reducing risk of leaks and money laundering. The wallet will act like a proxy between different forms of payments. Whether this can match up to the dozens of mobile wallet options already out there, or would it have been wiser to invest into an already existing wallet and not opening a new one, remains to be seen.
What do you think? Are you willing to have multiple cross company platforms of mobile payment wallets or would you prefer one wallet? Let us know in the comments on our official Facebook page Entreprenuer India