Indians are carrying a lot of money in their pockets, but not in the form of cash currency notes but rather in the form of digital money in mobile wallets offered by local and global organizations. From paying smaller amounts, as for a cup of tea on the street, to paying for bigger bills, mobile apps are gaining traction among the masses.

A market study by Credit Suisse Group AG estimates that the Indian digital payments market will increase five-fold from the current $200 billion to $1 trillion by the year 2023, reports The New Indian Express. However, cash continues to account for around 70% of all transactions by value in the country, which indicates the vast and untapped potential that exists for digital payments. In comparison, the neighboring Chinese market is already way ahead, with around $5 trillion worth of mobile payments. 

The Digital Payments Journey in India

While home-grown digital mobile wallets like Paytm and Mobikwik have been operational for many years, the digital transactions got the real boost from the November 2016 demonetization exercise, when the government banned higher-denomination currency notes of 500 and 1,000 Indian rupees. It indirectly forced citizens to switch to digital payments, but the effects faded away after a few months as government introduced replacement currency notes, including a new 2,000-rupee note (worth about $28).

Despite cash still being the king in the Indian economy, the digital forms of money, and the associated app-based wallets, have seen increasing acceptability among the younger, tech-savvy population of the second-most-populous nation in the world. Regular offers of cash backs, discounts and freebies have also promoted their usage. With the government welcoming overseas investments in a bid to improve and expand financial services in India, the market has seen many new launches for mobile payments platforms by leading global technology and financial corporations, and increased seed funding by big investors. “This kind of a promising market exists nowhere else,” said Vivek Belgavi, a Mumbai-based partner at PwC India. 

With the competition being at an all-time high, here’s a look at the top contenders trying to grab market share.


Owned and operated by One97 Communications Ltd., homegrown Paytm remains the most popular mobile pay platform among Indian users. It was the instant beneficiary of demonetization, and continues to maintain its stronghold among local merchants and retail outlets. It has secured funding from Alibaba Group (BABA), its affiliate Ant Financial Services Co. and recently from Warren Buffett’s Berkshire Hathaway Inc. (BRK.A) (See also: Berkshire Hathaway Confirms Investment in India's Paytm.)

Alphabet Inc.’s (GOOGL) Google Pay

Google recently rebranded its Google Tez payment app as Google Pay, which now hosts new features, the most notable one being the offer of instant loans that requires minimal paperwork. With more than 22 million monthly active users who jointly accounted for over 750 million transactions with average annual transactions worth 200 billion Indian rupees (about $2.8 billion), Google has been active in the Indian payment market since September 2017. The rebranding from Google Tez to Google Pay is part of an effort by the Mountain View, California-based technology giant to unify all of its global payment offerings. (See also: Rebranded Google Pay Offers Instant Loans in India.)

Facebook Inc.’s (FB) WhatsApp

The Menlo Park, California-based social media giant is offering limited mobile payment services through its messaging app subsidiary WhatsApp. Launched in February on a trial basis for around a million users, WhatsApp’s payments feature is expected to capitalize on its strong user base in India, where it is the most popular messaging app. However, the app is mandated by the government to host the data locally, as well as contain the spread of fake news and illicit content on its platform, which have led to unrest in parts of the country. WhatsApp needs to tackle these issues, which may otherwise dampen its planned gala launch.

Flipkart’s PhonePe

Indian e-commerce bellwether Flipkart was recently purchased by Walmart Inc. (WMT). Flipkart's PhonePe mobile app is also gaining popularity with more than 133 million downloads. With regular television and print ads offering cash back and discounts on Flipkart purchases, PhonePe is gaining traction and recently got $66 million funding from its parent.

Indian Government’s BHIM App

The digital drive by the Indian government also led to the launch of the BHIM (Bharat Interface for Money) app, which is built on the Unified Payment Interface (UPI) and allows transactions through virtual or disposable accounts that can be generated from within the app. Supported by all of India's banks and their online accounts and mobile apps, a user can utilize both push and pull methods to send or request money. Backed by the Indian government, the simple, fast, and clutter-free app is targeted toward non-tech-savvy users in rural India. Though it has managed more than 32 million downloads since launch, its lack of special offers matching those of other services may limit its spread.

Other Players

  • On Sept. 1, government launched the India Post Payments Bank (IPPB), which allows for banking at 650 branches and thousands of post offices across the country. While new, trained postmen operating even in remote areas are expected to teach users and make its app popular for banking as well as transactional needs for common citizens.
  • Backed by the Jio telecom network, Jio Money has been operational for more than a year, though its scope has remained limited. However, parent company Reliance Industries ranks among the most valuable companies of India and has the potential to push for deeper and wider penetration of the payment app.
  • Another homegrown app, Mobikwik, also works similar to Paytm and remains a strong contender.
  • Inc. (AMZN) has also recently started pushing its Amazon Pay app, though it is stillm limited to Amazon purchases and bill payments. It is possible to see it expanding to P2P transactions in future.