Tencent, Alibaba fight for share in India’s mobile payment
The war between Tencent and Alibaba has spread to India. This time, they’re wrestling over mobile payments.
Indian chat app Hike Messenger, which Tencent invested in last August, recently added a “red envelope” function similar to WeChat’s. WeChat’s “red envelope” function is based on the tradition of “hongbaos” given during special occasions. Users on the app can gift money to family and friends, where it’ll be deposited to their WeChat account.
In Hike Messenger, this similar function is used to deepen connections with friends. Nicknamed “blue packet”, users are free to choose different themes and attach auspicious phrases to the money gift.
Hike’s payment and transfer channels need to go through Unified Payments Interface, a payment system launched by National Payments Corporation of India and regulated by the Reserve Bank of India which facilitates the instant fund transfer between two bank accounts on the mobile platform.
At the end of 2016, the Indian government demonetised the 500 and 1,000 rupee banknotes, and this state-level electronic payment and settlement service was used to replace cash transactions.
The demonetisation led to lesser cash flow in India, making the largest payment companies Paytm the biggest winner in this. Paytm was the first company to help mobile operators collect bills, and in 2013 had launched the Paytm Wallet.
In January 2015, Paytm accepted a 575 million US dollar investment from Alibaba, and in the same year became India’s number one payment tool.
Based on user base, Hike Messenger and Paytm are not on the same level. In February, Paytm announced more than 200 million users, compared with Hike’s 100 million users, of which 95% were located and registered in India. However, Hike’s advantage over Paytm is the “blue packet” function, just like how WeChat trumps Alipay with the “red envelope”.
Tencent, which invested in Hike, seems to want to recreate the drama of its application overtaking its rival. Both Hike and Paytm are currently campaigning for a “no cash day” social event in India. But the reality is much more complicated. In India, the chat application with the largest amount of users is not Hike, but WhatsApp, which is under Facebook. Currently, there is an average of over 200 million users in India each month.
In April this year, WhatsApp also publicly offered to launch payment services in India. Although Hike snatched the upper hand for now, WhatsApp’s user base is way larger.
For now, it remains unclear who the winner is.
This article originally appeared in Qdaily and was translated by Pandaily.
Click here to read the original Chinese article.