SoftBank Group Corp. plans to announce that it will launch a mobile digital payments service in Japan by the end of this year. This service is expected to be launched in collaboration with the Indian digital payments startup Paytm. Masayoshi Son, founder of SoftBank looks to expand into this sector, people familiar with the matter said.
This digital payments service is expected to make extensive use of artificial intelligence for mobile payments, along with other financial services. Dozens of employees of Paytm are working in Toyota on getting the service up and running, one of the people said.
Since there is no global leader in the digital payments sector, SoftBank is hoping that this Japnese program will provide a launchpad for the service to expand in the global market. Son seeks to capture the market that is moving away from cash and provide them with a comprehensive platform. This platform can later be used to expand into lending, insurance, and other financial services, as claimed by the source.
On a global level, Paypal Holdings, Ant Financials, Tencent Holdings, and Paytm have a huge customer base but it is limited to their geographies and no clear global winner is in sight.
In, the next two years, regulatory changes coming into effect are expected to accelerate a shift to digital payments. This is a window of opportunity for the company, and there are other interested parties venturing into this space including banks.
SoftBank’s collaboration with Paytm is set to push it forward in the right direction, leveraging Paytm’s expertise in the digtial payments industry can help SoftBank acquire a good customerbase.
Paytm has recently crossed a milestone of 5 billion transactions in a year, along with $50 million in gross transaction value over the past 12 months. Paym has edged past its competitors in India by huge margins. This new collaboration with SoftBank if successful will give them access to an even wider customer base and expand its lead over its competitors.