The Facebook and Reliance Jio's partnership will have a major impact but the result can only be known once the product is out in the market. The current deal will allow the launch of Whatsapp Pay. That’s the immediate impact and Facebook has been waiting for this because of the large market share the giant messaging app has, said Ashneer Grover, CEO & Co-founder of BharatPe, an offline QR payment app making payments ubiquitous. "The minute it is launched it will take the whole payment aspect to the next level. On the consumer side, all the apps have stagnated for the last five months. The only way left for the government and industry to make UPI payments feasible is through the launch of Whatsapp Pay, " said Grover.
While the industry looks at this as a positive step that will encourage a number of users to move online and transact through UPI, the efficiency of the product will only be known once it gets launched. Ashneer stated, "They are keen on bringing Kirana stores online. The immediate change is positive for us because if Whatsapp Pay gets launched, UPI transactions will increase, which will increase the number of transactions on the QR Code as well."
BharatPe with a 4 million userbase and its lending business, has spread its wings in all segments of fintech. While the startup is backed by Sequoia, it has gained a lot of traction within the two years of its inception. "We are doing roughly 4.5-5 lakh transactions in a day. Prior to this, we use to do 15-16 lakh per day. So while the volume has decreased by 50 percent, the ticket size has become better," said Grover.
Post-Covid Era
The players in the industry foresee various consolidations due to less cash flow and capital issues. "A lot of businesses that are at less than $50 million will not be able to exist. Anyone who has less than 9 months of runaway cannot exist standalone. They will have to merge into something else. We will see a lot of deals happening wherein a lot of large companies might merge with others" said Ashneer.
While people are speculating mergers and acquisitions on the ground, Grover believes that in terms of a larger company, only half of them will survive in the coming four months. So, a Zomato might merge into Swiggy or Razorpay might merge into PayU, he said.
However, there will be a surge in online education platforms and OTT platforms, said Grover. He also stated that due to the recent announcement of revised FDI guidelines, the China investments will be closed for Indian businesses.