Zomato has launched its own Unified Payments Interface (UPI) service for some users in partnership with ICICI Bank. This will facilitate both merchant and peer-to-peer payments. Flipkart, another e-commerce giant, is also developing its own UPI service.
What Happened? Per an ET report, the move by Zomato and Flipkart is aimed at improving customer service through their proprietary UPI offerings.
This aligns with the National Payments Corporation of India’s (NPCI’s) broader strategy to diversify the UPI network by including more large consumer internet companies, thereby reducing dependency on current market leaders PhonePe and Google Pay.
An insider explains in the report that owning a UPI offering can be a hedge against potential merchant commissions for companies with millions of transactions annually. It could also mitigate payment downtime during peak hours on food delivery platforms.
It is worth noting that Zomato established a subsidiary, Zomato Payments Pvt Ltd, in August 2021 to provide digital payment services. The company recorded 58 million annual transacting customers in 2022, an increase from 49.5 million in 2021.
While Zomato hasn’t officially announced the new feature, a company spokesperson confirmed the development to ET, stating that they aim to provide a seamless payment experience for their large customer base who frequently use UPI for their food orders.
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