Fintech giant PhonePe has launched its own payment gateway, aiming to reduce its reliance on external gateways and compete with industry leaders such as Razorpay, Pine Labs, and CCAvenue. While most payment gateways charge a standard transaction fee of 2%, PhonePe Payment Gateway is providing a limited-time free onboarding offer for new merchants. According to the company, businesses joining the platform can save up to INR 8 lakhs, allowing them to invest the saved onboarding costs into expanding their operations.
The PhonePe Payment Gateway is compliant with RBI regulations, ensuring the secure storage of customers’ tokenized cards in the PhonePe Card Vault with consumer consent. PhonePe already holds a dominant position in the UPI market, accounting for over 50% market share by value. Leveraging its expertise in handling large-scale transactions and the trust consumers have in the platform, PhonePe aims to provide an exceptional payment experience for both consumers and merchants.
The payment gateway offers effortless integration, digital self-onboarding, and a seamless checkout experience for customers. This move aligns with PhonePe’s strategy of becoming a comprehensive super app in India, similar to Paytm. Earlier this year, the company launched its Account Aggregator services and the Pincode shopping application, solidifying its presence in India’s thriving e-commerce sector.
PhonePe, founded in 2015, boasts more than 460 million registered users. Despite the funding challenges faced in the market, PhonePe has raised a total of $850 million this year and plans to strategically deploy the funds to expand its payment and insurance ventures in India. In May alone, PhonePe processed 47% of Unified Payments Interface (UPI) transactions, amounting to 449.9 crore transactions valued at INR 7.57 lakh crore. The company aims to continue its growth trajectory and offer enhanced services to its growing user base.
