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After conquering telecom sector, India’s largest company Reliance eyes online commerce

WhatsApp Pay has still not got the nod from India for its UPI-based payment service.

Photo by Avanish Tiwary

India’s largest company by market cap Reliance Industries is out there to compete with digital startups—most of them unicorns with a valuation of above a billion US dollars—in sectors including e-commerce, online grocery, video-on-demand, and digital payments.

Jio Infocomm, the telecommunication arm of Reliance Industries, has launched UPI-based (unified payments interface) digital payment on its JioMoney app. UPI is a digital payment tool created by the National Payments Corporation of India, an umbrella organization for operating retail payments and settlements. UPI allows instant money transfer from one bank to another using mobile.

To begin with, Reliance Jio has made the UPI payments available for select users on its app before a full rollout for its 370 million subscribers. It already has its own e-wallet service JioMoney and allows users to pay bills, recharge mobile phones, cable TV connections. Riding on the back of its huge user base and multiple offline retails platforms Reliance is likely to disrupt India’s digital payments market which is expected to touch USD 10.07 trillion by 2026. It wants a large share of this market and will compete with incumbent behemoths such as Alibaba-backed Paytm, Walmart-owned PhonePe, Google Pay, and Amazon Pay. While Reliance got NPCI’s go-ahead to start UPI-based payments, Facebook-owned WhatsApp’s digital payment tool WhatsApp Pay is still under regulatory hurdles for not complying with data localization rules.

UPI-based payments in India has seen mass adoption of late, mainly on the back of low-cost QR code technology, a 2019 KPMG report said. Google Pay topped the chart for facilitating the highest number of UPI payments with 59.75% share, leaving PhonePe and Paytm trailing behind with 24.91% and 5.93%, respectively in August last year.

In addition to launching UPI based digital payment, Reliance Jio is getting into wealth management as well to offer financial services such as lending, mutual funds, gold trade, and stockbroking. It has obtained an account aggregator (AA) license from the Reserve Bank of India (RBI) that would enable the company to collect and share financial information with third parties after getting the user’s consent.

Last month, Reliance Jio also launched its e-commerce platform JioMart and in the initial phase will focus on the high-consumption category that includes grocery, staples, and other household products such as shampoos and soaps.

“There is definitely a huge opportunity in India’s digital market, be it payment or online commerce. Seeing what Reliance Jio has done till now in terms of a slew of acquisitions last year, I think there is much more to come from them. We are just spectators as of now,” Pratik Poddar, principal at Nexus Venture Partners told KrASIA.