After its success in selling low-cost handsets and smartphones, homegrown mobile phone maker Micromax Informatics on Tuesday forayed into mobile payments with its own native mobile wallet, as it aims to gain from the growing trend of digital payments for online shopping, utility payments and app purchases.
“The device is going to be more of a customer acquisition tool,” Vikas Jain, one of the four co-founders of the New Delhi-based company, said. He added that the company hopes to see at least 130 million people use the service in the next two years.
As part of the plan, Micromax said it has entered into a strategic partnership with TranServ, a digital payments company. In the next three months, almost 80-90% of its over 40 devices will have an inbuilt mobile payment service embedded in its handsets, Jain said.
Apart from its own new smartphones, Micromax aims to roll out its mobile payments to its existing active user base of about 25 million, through its 1,35,000 retail outlets, across the country, he said.
The move comes at a time when handset companies, including Micromax, are facing tough competition from Chinese smartphone makers who sell at prices far below what Indian companies can offer. The move to service is a global trend, with Apple getting into payment services through Apple Pay to garner a share of digital payment revenue.
Yu Televentures, another company owned by the founders of Micromax, last week forayed into integrated services by launching its own aggregation of service providers across cab to flight bookings, to food ordering, on its smartphones.
“We have seen a lot of global unicorns not being able to make money out of that (handset sales),” Jain said. “Fortunately, for us that part of the business is still profitable.”
The payment service is to close the gap for customers trying to use digital payments for buying in-app purchases on their smartphones. Micromax, through its mobile payments service, is also aiming to tap into online buyers who spend about $8.5 billion, and the Rs 30,000 crore utility payments market. Micromax Informatics’ mobile wallet will also have an app-linked debit card, wherein users can use the money in their wallet for offline payments at the more than 1.5 million outlets that accept debit or credit cards in the country, Anish Williams, co-founder of TranServ, said.
The two companies also plan to roll out financial inclusion solutions such as micro-loans and other financial services, they said.