PayU, a Naspers-owned company and one of the largest payment gateways in the country, has received a license from the Reserve Bank of India(RBI) to operate its own non-banking financial company(NBFC), a development which they believe will give a boost to its consumer credit business and promote inclusive growth in the country by catering to the diverse financial needs of various segments of society.
PayU, according to company executives, has an estimated 4,00,000 merchants on its platform. Based out of Gurugram, PayU India which processes monthly payments of about Rs 8,000 crore contributes about 47% of its parent’s total payment value, according to reports.
The approval from the central bank is subject to “certain pending RBI compliance”, PayU said in a statement. “We realized the potential in consumer credit space and have already introduced innovative credit products in order to tap the market. We have already served more than 500,000 consumers during last 12 months,” said PayU India managing director Jitendra Gupta, who is to head this new initiative.
“With payments, we have access to data, and we generate data… For us, when we look at the market, the new aspirational class coming in, they need access to financing. We give financing to the consumer, which, in turn, reinforces business with merchants… This is not a market where one company can dominate,”Laurent le Moal PayU global chief executive said. According to him, the strategy will be around building a platform consisting of three primary components — data, utilizing the company’s balance sheet, and a suite of products aimed at both consumers and merchants.
Moal trusts that India has an untapped opportunity with 36 million credit cards and 846 million debit cards as of January 2018 and this new NBFC license will launch new product variants faster which gives them an opportunity to innovate and offer products and services that are inclusive and support all consumers, including those who rely on alternative payment methods.
Sources: Economic Times