Instamojo claims 15x surge post demonetisation, touched peak of over 3,000 daily merchant signupsTarush Bhalla
On Tuesday, Instamojo, the online payments service provider for SMEs, announced having seen a huge surge in merchant signups — by 1,500 percent — on its platform post the government's move to take 500 and 1,000-rupee notes out of circulation.
According to the company, at one point of time last month, the platform was adding 3,000 online SMEs daily, with close to 50,000 new SMEs added over the last 40 days. The platform claims to be adding 1,000–1,200 new merchants and SMEs on a daily basis currently, and has close to 200,000 merchants on its platform.
Moreover, 65 percent of Instamojo's merchant base is from non-metro cities, showing a sharp pickup trend in Tier 2, 3 and 4 cities.
Speaking to YourStory, Sampad Swain, CEO of Instamojo, said that while digital wallets can be an essential payment acceptance solution for retail stores or street vendors, e-commerce and bigger stores might find hardware installations (PoS machines) to be a better option.
However, the market of home entrepreneurs and others might be largely ignored. He added,
“Instamojo is essentially a payment mechanism for online SMEs who want to do larger transactions. And owing to the high value of transactions, these home-based entrepreneurs, small and micro SMEs, individual sellers and freelancers essentially require a fourth type of payment solution, like Instamojo.”
Hence, according to the founders, the solution seems to have an edge over other payment methods like PoS, which require hardware installations or micro-wallets, which hold artificial restrictions on monthly payment acceptance.
Further, Instamojo allows SMEs to create payment links and send them to their clients while integrating multiple payment options. This includes net banking, mobile wallets, card networks and UPI, among others.
The company has also seen a strong upscale in payments. While Sampad said the number stands at double digit thousands every day, he doesn’t disclose an exact figure.
Before demonetisation, wallet transactions contributed to one percent of all transactions on the Instamojo platform, while credit and debit cards constituted 40 percent and 25 percent respectively.
However, post demonetisation, wallet payments contribute to three percent of all transactions, with UPI standing at 0.5 percent and credit and debit cards raking in up to 25 percent and 40 percent respectively. Hence, Sampad said it is also interesting to see the rise in debit card payments on the platform.
The firm has also launched the private beta of its mobile Android app and has seen a sharp shift in terms of traffic, with as much as 60 percent coming from it.
According to Sampad, the average transaction size has also picked up by 15 percent post the demonetisation announcement. Further, the firm is also looking to partner with multiple stakeholders in the ecosystem, directly or indirectly, to bring solutions beyond payments and commerce, such as lending, logistics, digital marketing and paperless accounting, to SMEs across India.
Sampad also said, “By FY18, Instamojo will have one million SME merchants on its platform. So far, only offline PoS companies have accomplished this feat, with a total installed base of 1.2 million that took 15 years. However, it will take less than five years for Instamojo to breach the one million mark.”
Tarush is driven towards delivering unbiased and accurate reportage while engaging with as many mediums as possible to narrate a fresh perspective. Working for the past few years in the digital space with YourStory, he has covered the Indian technology ecosystem extensively, focusing on new age Fintech companies, while building strong connects within the industry.