Amazon Pay explores potential across India's urban and rural landscapes: Report

Amazon Pay India, the digital payments division of Amazon India, is intensifying efforts to deepen its presence in offline payments this fiscal year. CEO Vikas Bansal emphasized the company's strategy to introduce diverse payment methods and enhance safety measures to combat fraud.

Since its launch in 2016 as a prepaid wallet service aimed at boosting cashless transactions on Amazon's e-commerce platform, Amazon Pay has evolved to offer a range of payment options including Unified Payments Interface (UPI), credit cards, and wallets, rather than specializing in one segment.

"We see opportunities in expanding our footprint in offline stores, exploring new payment methods, and continuing to invest in safety and security measures to mitigate fraud," Bansal stated during the launch of a report titled "How Urban India Pays," developed in collaboration with Kearney.

Following the successful collaboration with ICICI Bank Ltd for credit cards, Amazon Pay is exploring additional partnerships with banks for credit cards and opportunities within the government’s Open Network For Digital Commerce (ONDC), Bansal added.

Despite its growth, Amazon Pay's market share in India's retail payments segment remains lower compared to leaders like Google Pay, PhonePe, and Paytm, which collectively control about 90% of the market.

Bansal highlighted the significant opportunity presented by the increasing adoption of digital payments in smaller towns. According to the Amazon Pay-Kearney report, 65% of transactions in tier two and three cities were digital, reflecting a narrowing gap compared to larger cities.

"There's a growing opportunity to extend credit facilities in smaller towns, where credit usage is lower compared to metros," Bansal noted, emphasizing the potential for further expansion and adoption of digital financial services.

Amazon Pay has strengthened its consumer and merchant payment businesses, securing licenses from the Reserve Bank of India as a prepaid payment instrument and payment aggregator.

The company's initiatives underscore its commitment to leveraging digital payments to cater to diverse consumer needs while enhancing financial inclusion across India's urban and rural landscapes.