Walmart-owned fintech major PhonePe has announced the launch of Pincode, an app built on top of the government-backed ONDC platform.
With the rise of 10-minute grocery delivery, Payment giant PhonePe has stepped in with its own version 'Pincode' which will be powered by the ONDC delivery system.
Why it matters: The new app aims to connect digitized neighborhood stores and bring the small merchant ecosystem into the digital shopping fold. With nearly 450 million registered users on the PhonePe app, the company strategically opted to launch a new app instead of integrating it into the existing one.
Pincode will offer hyperlocal shopping options in various categories, and the company aims to reach 100,000 daily orders through the app by the end of 2023.
The big picture: The foray into the e-commerce space under the ONDC umbrella is an opportunity PhonePe couldn't afford to miss. As ONDC expands the consumer base for a seller, the company looks to expand Pincode to the top 10 cities in the first year of its operation. The company also aims to enter the mobility space eventually.
PhonePe plans to do an IPO in the next 2-3 years.
Between the lines: The launch of Pincode shows PhonePe's focus on the Indian market and its desire to expand its services to include more than just digital payments. The new app also highlights the company's interest in the small merchant ecosystem, which could have implications for the broader Indian economy.
Flashback: PhonePe was founded in December 2015 and acquired by Flipkart in 2016. Walmart acquired a majority stake in Flipkart in 2018, giving it a significant ownership position in PhonePe. The company has grown rapidly and is now one of the leading digital payments companies in India.
By the numbers: PhonePe has nearly 450 million registered users on its app, making it one of the largest digital payment platforms in India with a 54% market share.
It recently raised $200 Million from Walmart (Parent Organisation) with a valuation of $12 Billion. In total, the company has raised over $2.4 Billion.
Last year, The company reported a yearly loss of $104 Million (Rs. 789 cr)
What they're saying: "We believe that Pincode has the potential to be the go-to app for customers who are looking for convenience, speedy delivery, and a hyperlocal shopping experience," said Sameer Nigam, CEO, and founder of PhonePe.
Competitions: PhonePe's Pincode app is set to compete with other hyperlocal commerce apps like Binkit and Zepto, which offer 10-minute delivery options for a variety of products. However, Pincode's focus on digitizing small merchants and connecting them with consumers could potentially give it an edge over its competitors in the long run.
Market value of online grocery in India was over $1.4 billion in 2019 and was expected to reach about $16 billion in 2024.
Catch up quick: PhonePe, a digital payments company backed by Walmart, has launched a new hyperlocal commerce app called Pincode on the ONDC platform. The app will offer hyperlocal shopping options in various categories and connect digitized neighborhood stores with consumers. It aims to expand the app to the top 10 cities in India and eventually enter the mobility space. PhonePe has nearly 450 million registered users on its app.