Fintech

PhonePe Introduces PoS Device to Compete with Pine Labs, Paytm, and Razorpay in India’s Market

• ByStartupStory     |    July 7, 2023

PhonePe, a leading fintech company, has announced its entry into the Point-of-Sale (PoS) device market in a bid to compete with established players like Pine Labs, Paytm, and Razorpay. The market is currently dominated by these industry leaders, with the Reserve Bank of India reporting approximately 7.9 million PoS devices across India as of May 2023.

PhonePe’s PoS device enables merchants to accept payments through debit cards, credit cards, and UPI, positioning the company as a comprehensive offline payment service provider. By expanding their payment acceptance options to include credit and debit transactions, merchants can anticipate an increase in their average ticket size, resulting in overall business growth. PhonePe aims to deploy 150,000 devices nationwide by next year, leveraging its extensive network of over 35 million merchants.

The PoS device comes preloaded with the PhonePe POS app and supports various transaction methods, including tap, swipe, dip, and interoperable dynamic QR codes. In addition, the device is available at a nominal monthly rental fee and promises world-class product quality and service, as stated in the company’s media statement.

PhonePe’s entry into the PoS device market coincides with the Reserve Bank of India’s consideration of additional regulations regarding KYC and other payment processes for companies offering offline PoS devices. The company is positioning itself to compete directly with Paytm, its primary rival, which recently launched a PoS device capable of accepting card and UPI payments while also functioning as an audio-assisted smart device with SIM-based connectivity.

Furthermore, Razorpay, a prominent fintech unicorn, made its foray into the offline payments space by acquiring Ezetap in 2022 through a cash-and-equity deal valued at approximately $150 million.

In recent months, PhonePe has been expanding its range of services and products. On June 14, the company launched its online payment gateway, specifically targeting Micro, Small, and Medium Enterprises (MSME) merchants across the country. Additionally, PhonePe introduced its merchant lending platform, enabling banks and NBFCs to offer digital and seamless access to credit for its vast base of over 35 million merchants.

As per the Reserve Bank of India’s data available as of May 2023, India currently has around 7.9 million PoS devices, with Paytm Payments Bank accounting for approximately 640,000 of these devices nationwide.

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