BHIM, developed by the apex group for digital cost techniques within the nation — Nationwide Funds Company of India (NPCI), will foray into the ecommerce area on ONDC by a separate division, they added.
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“The hope is that with BHIM’s customers ready to buy meals and drinks, groceries, vogue and attire, on ONDC, the adoption of BHIM app will enhance in comparison with its opponents GooglePay, and PhonePe,” stated an official conscious of the matter.
NPCI and ONDC didn’t reply to ET’s request for a remark.
BHIM constructed on NPCI’s digital funds railroad Unified Funds Interface (UPI) — was launched in 2016 however has seen a lot decrease adoption in comparison with rivals akin to Google Pay and PhonePe, which collectively command practically 85% of India’s digital cost market.
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Each Google Pay and PhonePe are additionally constructed on the UPI platform and designed to facilitate e-payments immediately by banks and encourage cashless transactions.
With BHIM as a consequence of debut on ONDC, its prospects are anticipated to enhance.
Extra so, as there was a pointy upsurge in downloads of BHIM since regulatory curbs on the third-largest participant within the house, Paytm, got here into impact in finish of January.
Information from app intelligence agency Appfigures confirmed that BHIM app downloads noticed a major 21.5% week-on-week enhance from 111,000 downloads on Play Retailer on January 27 to 135,000 downloads on February 3.
NPCI additionally appointed ONDC’s former govt vp for strategic initiatives Rahul Handa because the chief enterprise officer of BHIM in March.
Handa was at ONDC for over two years from February 2022 to March 2024.
Lack of selling budgets
Specialists are of the view that regardless of its launch in 2016 with a lot fanfare, BHIM has languished as a consequence of lack of adequate advertising budgets.
“It (BHIM) misplaced out to Google Pay, PhonePe, and Paytm as (the) three mixed now have a 98% market share and BHIM has a negligible market share,” stated Ranadurjay Talukdar, companion and funds sector chief, Ernst & Younger India.
“It (BHIM) didn’t have a separate advertising price range to woo customers with cashbacks. On the service provider facet enablement, there was no separate BHIM initiative whereas Paytm, PhonePe and Google Pay invested important advertising {dollars} in buying retailers,” he stated.
From a client’s perspective, the pondering was that they need to obtain the identical cost app whose QR code they noticed on the storefront. “This lack of expertise of interoperability from the customers additionally led to extra market share for the three apps — GooglePay, PhonePe, and Paytm,” Talukdar stated.
Now, NPCI is embarking on a BHIM 2.0 venture to reimagine, and rethink the consumer journey on the app. With new partnerships, like with ONDC, BHIM’s utilization is anticipated to go up, in keeping with business specialists.
Through the four-day interval from January 31-February 3, the BHIM app witnessed a 50% enhance in downloads from 397,000 for the corresponding interval within the earlier week to 593,000, in keeping with Appfigures.
Nevertheless, banking closely on ONDC alone to drive development is not going to assist BHIM.
“Altering client behaviour, the belief that clients repose in a funds app is just not very simple to construct,” stated EY’s Talukdar.
Excessive focus danger
On April 17, ET had reported that a number of new third-party funds apps on UPI are being nudged by the NPCI to take a position and incentivise customers.
That is primarily aimed toward getting customers to transact by these new platforms, to scale back the chance from excessive focus of transactions on PhonePe and GooglePay, three corporations had advised ET.
Since its formal launch in January final yr, ONDC has facilitated greater than 49.79 million transactions. Mobility led by ride-hailing apps akin to Namma Yatri continues to dominate with greater than 50% of whole month-to-month orders. From February final yr to March this yr, mobility accounted for greater than 32.2 million orders whereas non-mobility accounted for greater than 17.5 million orders.
Firms and platforms which have been onboarded embrace Wow Momo, McDonald’s and Domino’s Pizza in meals and beverage; Marico, P&G and Hindustan Unilever in FMCG; and Namma Yatri, Kochi Open Mobility Community and Ola in mobility.
ONDC had its alpha rollout in April 2022 in 5 cities to guage stay transactions with a closed group of sellers and consumers.
“Cost networks hardly ever have a B2C product, they’re predominantly B2B gamers. They work with banks to supply merchandise to their customers. In that sense NPCI is exclusive. Operating a profitable B2C enterprise is just not going to be simple for NPCI,” Talukdar stated.
