India’s largest ecommerce platform is perhaps taking the next logical step in its expansion — building base for its own payment services. As a part of that process, Flipkart has now acquired a majority stake in payments startup – FX Mart, to integrate payment service in its own platform as well as in Myntra’s.
As per the documents available with Registrar of Companies (RoC), Flipkart has paid around Rs. 45.4 crore to acquire a majority stake in FX Mart. Also, two senior executives of Flipkart has also joined the board of FX Mart, reported Mint.
FX Mart was founded by Amit Narang in 2013 and is Headquartered in Zirakpur( Mohali) near Chandigarh with a corporate office at Delhi. The company has 8 offices and an agent network in a massive 1,000 plus locations across India.
Reports further mention, that Flipkart is planning to launch payment service on its mobile applications within the next three months. Just to put thing sin perspective, FX Mart owns a coveted prepaid license issued by Reserve Bank of India, thus virtually allowing Flipkart to offers its own wallet service any time now.
While majority of the online customers prefer cash-on-delivery system, the use of prepaid wallet is increasing in the nation. PayTM and Mobikwik are perhaps the biggest example of that change in payment processing in India. This could help Flipkart to implement cashless payments and save the troubles of COD.
However, Flipkart is not only planning to use the payments service on its own platform, but will also offer this services as a third-party platform. FX Mart is Flipkart’s second acquisition in digital payments. Earlier, it bought NGPay (Jigrahak Mobility Solutions Pvt. Ltd).
There are already several online payment services start-ups in India such as Citrus, PayU, CCavenue, Zaakpay, etc. However, the wallet market is dominated by PayTM, followed by Oxigen and MobiKwik.
The Indian payment services market is abuzz with competition right now. This heated up even more, when RBI announced a list of 10 services getting license to operate their own payment banks, which included the Alibaba-backed PayTM. Vijay Shekhar Sharma is planning to establish a new entity named PayTM Payment Bank Ltd. for the payment services.
Other than Flipkart, Ola has already started its own wallet service named Ola Money. It is also said that Snapdeal is working on its own payment service which it plans to launch by the end of this year.