A Japanese venture launched in 2018 by India’s top payments app already has eight million customers, giving Paytm’s PayPay a sizable share of a vast new market, even as it competes against international payment companies in its home country.
Paytm, run by One 97 Communications Ltd, is a QR code-based mobile payment service that has taken off in Japan, Paytm Founder Vijay Shekhar Sharma told the Financial Times.
“In Japan, we have incredible traction,” said Sharma, 41, one of India’s youngest billionaires. “We just touched eight [million] customers. That number within six months is amazing.”
A joint venture between Paytm, SoftBank and Yahoo! Japan, PayPay offers a cash incentive to each customer who downloads the app and authenticates it with a valid Japanese mobile number, according to reports. Users will get a 20 percent rebate for payments using a bank account, 19 percent with a Yahoo credit card and 10 percent with other types of credit cards. The app is also waiving fees for sellers and establishments until the end of September 2021.
PayPay allows users to store money from a bank account in their PayPay wallet, a push to promote the use of cashless payments in Japan, a country that has been slower to embrace new payment technology. About 20 percent of all transactions are cashless, with hopes of increasing that to 40 percent by 2025. Even larger businesses like supermarkets and medical clinics still insist on cash.
The country has no plans to issue its own digital currencies because of uncertainty over how it will impact Japan’s banking system, Bank of Japan Deputy Governor Masayoshi Amamiya said earlier in July.
A market leader in India with over 250 million users, Paytm is facing increased competition from big tech firms like Amazon and Google, per reports.
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