Zomato launches UPI offering for merchant, P2P payments
Zomato will enable users to create UPI IDs on the Zomato app to make payments without the need to switch to another payments app.
Tuesday May 16, 2023,
3 min Read
Food and grocery delivery platformhas gone live as a third-party application provider to offer payments through Unified Payments Interface (UPI). The firm has partnered with ICICI Bank to offer both merchant and peer-to-peer payments, as per the National Payments Corporation of India's (NPCI) website.
The move is expected to enable the company to list its own UPI offering for payments.
Zomato set up a subsidiary company, Zomato Payments Pvt Ltd, in August 2021, to offer digital payments services including wallets and payment gateway services. It also offers Zomato Pay, an option to enable users to make payments through the Zomato app in select restaurants.
Last month, the firm discontinued its partnership with RBL Bank for co-branded Edition credit cards.
The Economic Times was the first to report on the development.
"Zomato has a large set of customers who frequently use UPI to make payments for their food orders. We are providing a facility (as technology partner to ICICI) for customers to create a UPI ID on Zomato app so that they can make payments seamlessly (without the need to switch apps)," a Zomato spokesperson told YourStory.
NPCI has also been attempting to reduce the dependency on PhonePe and Google Pay—the two most-used UPI payments apps having a combined market share of over 80%. The payments regulatory body introduced a mandate to hold not more than 30% of the market share on the UPI network in terms of payment volume. The deadline to adhere to the mandate has been extended to December 31, 2024.
Walmart-owned Flipkart is also looking to start its own UPI offering, ET reported on Tuesday. Tata's super app Neu also joined UPI last year. Other internet-led firms on the UPI network include MakeMyTrip, Amazon, and Meta-owned Facebook.
Kiwi, a recently launched fintech platform, has also joined the UPI network. Co-founded by Siddharth Mehta (former CEO, Freecharge), Mohit Bedi (former Axis Bank and PayU executive), and Anup Agrawal (former business head, LazyPay), Kiwi announced the launch of a new solution called "Credit on UPI" for customers on May 3, making it the first app in India to provide "Credit on UPI" by issuing RuPay cards in collaboration with banks.
It has raised $6 million in pre-seed funding from renowned investors, including Nexus Venture Partners, Stellaris Venture Partners, and several angel investors.
Zomato rival Swiggy launched Swiggy Money in June 2022 in partnership with ICICI Bank to allow users to store money in wallets. Users choosing 'Swiggy Money' can avail instant refunds and use the money for easy checkout on food orders, it had said in a statement.
In April 2023, UPI transactions reached a new high in terms of volume with 890 crore successful transactions—a 59% increase from April 2022. The value of these transactions increased by 49% to Rs 14.07 lakh crore, as per NPCI data.
Edited by Kanishk Singh