There are already indications that PhonePe
has shed its Flipkart
training wheels. From 50 per cent of its transactions three years ago, Flipkart now accounts for just 0.5 per cent, The Ken
reported, citing PhonePe’s head of strategy and planning. During Flipkart’s annual Big Billion Days sale last month, PhonePe’s logo no longer had top billing on the e-commerce website, according to The Ken
. Instead it was listed as just one of the many payment options available to online shoppers.
That PhonePe is preparing to fly solo is also a sign of India’s maturing digital sector. Not only is the company willing to directly tackle rivals such as Alphabet’s Google Pay and Facebook’s forthcoming WhatsApp payments, but it’s also managing to survive in the scary wilderness beyond the gates of Flipkart. (Survive, of course, is a relative term. It’s likely still burning cash and posting losses, though at least it can keep up with well-funded adversaries, a key measure of success at this point in the game.)
More broadly, the PhonePe spinoff would strengthen the case that a homegrown hero can hold its own when foreign rivals enter. Paytm, another Indian startup, is on the verge of landing a $2 billion round of funding from investors including Ant Financial, SoftBank Group and Discovery Capital Management which could give it a $16 billion valuation, Bloomberg News
reported this week.
Hopefully the momentum at both PhonePe and Paytm
will spur more Indian entrepreneurship, feeding a rebirth in India’s tech sector
not seen since the IT-outsourcing boom two decades ago. While that gave us Tata Consultancy Services, Infosys, Wipro and dozens more, most of those businesses focused on serving foreign needs.
Now, a crop of stars is emerging to meet the needs of India’s 1.3 billion people. It’s not a big step from this spinoff to an actual IPO, a development that will put India back on the global technology map.
(1) This assumes no reduced valuation for Flipkart.