Paytm, which has made a fortune out of its QR-code based mobile payments system, is now all set to open the platform to allow third-party services. This will enable users to scan codes other than that of Paytm.
The move seems to be a part of the company’s strategy to build a discovery business, especially in the offline space. To generate revenue from the service, it is expected to monetise by charging third party brands and plugging advertisements.
Paytm’s move to enter into the segment comes on the back of companies using traditional advertisement routes, such as print advertisements, brochures and retail products among others, to offer detailed information regarding their products and services.
Commenting on this, Deepak Abbot, Senior Vice President at Paytm, said,
The scan and pay feature has been a good success for us and now we are enabling this for third party QR code on open sources. To start with, we are aiming to offer the same experience to the users as they usually have on Paytm. This is being built as the go to engine of sorts for discovery for web links, download apps, discover products, store information as well as continue to make payments.
Paytm first introduced this payment option in October 2015 allowing a customer to scan a code with their smartphones and instantly transfer money to the merchant’s Paytm account. It has already committed to investing about Rs 600 crore for its QR code solution this year.
At present, over 65% of transactions are being done by QR codes on its platform. The Noida based company has been pushing it aggressively for offline merchants for a wider network of merchants.
Unlike other PoS (point of sale) machines, QR code based payment services have zero transaction charges and have no cost of installation. However, once a merchant transfers the money from digital wallet into bank account, there is a minimal transfer fee.
The company is aiming to add 10 million merchants enabled with these codes across 650 districts by December. The investment will be utilised to increase manpower, technology, cashbacks and merchant education.
Paytm is not the online player in India when it comes to QR code based payments. Unified Payments Interface (UPI) has also introduced QR code based payments while government of India has also launched Bharat QR code to promote digital payments across channels.