2. WHATS APP versus PAYTM

PAYTM Versus WHATS APP:- Detail Analysis ******************************************************************************* PAYTM:- Paytm, the $8 billion-valued company behind the country’s top digital wallet, is in the process of expanding its services into person-to-person communication, games and other mobile content. PayTM said in February that it had amassed 200m users, making it the largest of the prepaid “digital wallet” company ******************************************************************************* WHATSAPP:- WhatsApp is a cross-platform instant messaging service for smartphones that relies on the internet for the transmission of messages. It enables users to share text, image and video messages – the service handles more than 600 million photo and 64 billion overall messages every day. In the United States, the daily engagement rate among Android WhatsApp users was 36 percent. While WhatsApp claims 1.2 billion users worldwide, only 200 million of those are in India. The country currently counts about 355 million users, and that figure is set to reach 500 million people who will come online via phones by 2020. The company started offering peer-to-peer payment support on Facebook Messenger in 2015, and registered in October to provide electronic payment services across the EU. India has more WhatsApp users than any other country — at 160m in November 2016 ******************************************************************************* UPI UPI stands for United Payment Interface and facilitates sending and receiving money in real time through a mobile application. (By Government of India, NPCI) ******************************************************************************* WHATS APP HAS AN EDGE OVER PAYTM: Whatsapp isn’t small. It has 200 million users in India. Paytm’s has less, with 160 million. As reports suggest Whatsapp will launch UPI-linked payments in the next six months that will allow merchant-consumer transactions. That will make things difficult for Paytm. While WhatsApp may be a threat to Paytm, the other way around may not be so as people will not download Paytm for just messaging each other. ******************************************************************************* PAYTM HAS AN EDGE OVER WHATSAPP:- Paytm is on the verge to become a payment bank. With a banking license, paytm can do a lot more than a traditional wallet. Paytm’s business has rocketed over the past year, primarily thanks to the impact of demonetisation, which saw 500 INR and 1,000 INR notes recalled and spurred digital payments in India. The policy helped the number of Paytm wallets jump from 135 million in August to 177 million by the end of December, while offline transactions went from being 15 percent of its volumes to 65 percent. Paytm processed $1 billion in GMV in India in July — but the company is looking to expand its appeal and engagement with users by moving into messaging and content. (There’s also the potential to make money from social games, as chat app Line showed with $1 billion in revenue last year.) The ultimate goal, TechCrunch understands, is to reach 100 million monthly active Paytm users by end of the current Indian business year — that’s a deadline of April 1 2018. Beyond payments, Paytm also operates an e-commerce service and is planning to enter the digital banking space. What’s particularly interesting about Paytm’s mobile strategy is that parent company One97 Communication has a history in this space. It started out producing mobile content before it unearthed a mobile payments business and span it out. Another factor: Paytm’s largest shareholder is Alibaba is keen on exploring messaging after it totally missed the opportumity in China. Today its rival Tencent dominates the space with WeChat, which is encroaching on Alibaba’s core payment and commerce businesses. Chinese company Alibaba has had influence on shaping Paytm’s move into messaging. Paytm currently claims 230 million registered users. While most media have reported that this is larger than WhatsApp’s 200 million monthly users in India, it isn’t since Paytm’s active userbase stands at 54 million Paytm recently raised $1.4 billion in funding from Japan’s Softbank, so it’s more ready than ever to take on a big challenge. It’s worth noting that Paytm is also a marketplace for everything from clothing to electronics, as well as air and movie tickets. With the introduction of messaging, it’ll feel more like WeChat’s Swiss army knife app that’s hugely popular in Southeast Asia than WhatsApp’s one-trick pony. ******************************************************************************* WHY PAYTM SCARED OF WHATSAPP:- For all valid reasons Paytm might be scared if Whatsapp starts person-to-person payment . ******************************************************************************* WHY THERE IS A COMITITION:- There were 262m transactions worth Rs83.5bn ($1.3bn) using digital wallets in January, according to the Reserve Bank of India, up from 100m in October and 49m in January 2016. Digital payments in India would jump nearly 10 times to $500 billion by 2020, according to a 2016 report by Boston Consulting Group, with cash transactions falling from 78 per cent of the total in 2015 to less than 50 per cent in 2023. India has been on a huge digital payments boom — WhatsApp couldn’t have asked for a better time to roll this out At times people open Whatsapp up to 150 times a day, and they are familiar with the app. Like video and voice calls, soon people will be able to buy goods from the shop and pay using Whatsapp Hike, a rival chat service which claims 100 million users in the country, already supports payments.– the Indian market has plenty of room for more messaging apps. With that in mind, the time is ripe for businesses with the ability to scale and monetize to attempt to reach more customers with their mobile services. Paytm is the largest player with millions of merchants accepting digital using a Paytm wallet. If Whatsapp can be added as a wallet, users might not have a reason to install Paytm on the smartphones. WhatsApp is not the only company that's entering the digital payments market this year. Recently, the Sweden-based Truecaller — another company that counts India as its largest market — introduced user-to-user payments in a tie-in with ICICI Bank. The Truecaller system also utilises UPI. With 150 million active subscribers in India, the combined force of WhatsApp and Truecaller is enough to give Paytm a literal run for its money.