Trupay expects to acquire 50,000 merchant clients in the next six months as it customises its application to enable merchants to accept payments through the Unified Payments Interface (UPI). Co-founder Vivek Lohcheb tells Shritama Bose the fintech player plans to capitalise on the divergent payment patterns and requirements of vendors across sectors. Edited excerpts:
Given the plethora of UPI apps, how do you differentiate yourself?
We existed even before UPI did. We launched our application in February-March 2015 and back then, we had connected a few banks for bank-to-bank money transfer using a mobile number. For that, we had created our own mini-UPI kind of switch, but for that there were limited banks. So we shifted to UPI amid the government and regulatory push. Now when there are so many applications enabling consumer UPI, the biggest lacuna that UPI has is that merchants have not started using it. There are enablements in the BHIM app itself in bits and pieces, but there is a lot more customisation that is required for merchants.
How exactly do you enable merchants to accept payments via UPI?
Merchant payments are very different from peer-to-peer payments and these are again different from restaurants. Where people have to queue up at a counter, it’s yet another situation. So different use cases require different customisations. That is exactly what we are doing.
What is the average turnover of the merchants you have approached and what is the nature of their businesses?
We have about 1,500 hotel clients, 1,000 retailer clients, 2,000 restaurant clients and 500 educational institutions. These are mid-segment merchants, whose monthly turnover ranges between around `25 lakh and Rs 2 crore.
Do you work with channels other than UPI?
BharatQR is another enablement we are working with.
So what is your revenue model?
Our revenues come from merchant transactions, we charge a fee for each transaction. For educational institutions, there is a flat charge, which ranges between Rs 10 and Rs 15, irrespective of the value of transaction. For e-commerce merchants, the fee ranges between 0.25% and 0.8%, depending on the size of the transaction, the merchant and related factors.
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What does that leave you with after deducting MDR?
Payments always happen on very thin margins because it’s really a volumes game. It’s high volumes that give you profitability. So we get around 0.1-0.2% per transaction.
What are volumes like?
We have gone live only two months ago. We are looking to transact with around 50,000 merchants and about 500 crore transactions in the next five to six months.