Startup Street: Why Paytm Wants To Go The WeChat Way
This week on Startup Street, read about why India’s largest fintech startup Paytm decided on integrating an instant messenger service onto its payments app. Self-driving car rental startup Revv has partnered with Intel’s Mobileye to install driver assistance systems in its cars, and India’s startup ecosystem grew even as funding dried up. Here’s what went on.
Does Paytm Need A Chat Service?
There are some restaurants which serve ice-cream, and there are some which don't. “We want to be the restaurant that serves the ice-cream too.”
That's how Paytm's Vijay Shekhar Sharma explained the payments app's decision to integrate an instant messaging service, stepping into the turf of Chinese giant WeChat and Indian rival Hike Messenger. Apart from offering vanilla chat features, Paytm Inbox gives the 1.4 lakh sellers on its e-commerce platform a direct window to interact with more than 20 crore users.
“This will make payments easier, as everyone from individuals to local retail stores to home-based entrepreneurs can now interact and initiate payments on-the-go,” the company said in a blog post on Medium. It also cuts down the nearly six-step process of sending money on Paytm, to a single swipe.
This marks another instance of China’s Tencent Holdings and Alibaba Group extending their battle for online dominance to India. Till a couple of years ago, Alibaba's digital payment service Alipay was a dominant force in China with nearly 90 percent market share. That dropped to 54 percent after Tencent-backed WeChat, too, launched a payments service.
WeChat started as a messenger app but has now expanded into media, payments, ride-sharing, e-commerce and more. It introduced communication channels that allowed brands to connect with users and market goods. With nearly 1 billion users, WeChat now accounts for a third of China's internet usage, according to Kleiner Perkins' Mary Meeker Report.
India's Hike Messenger, also backed by Tencent, had in June integrated digital payments into its chat application.
SoftBank and Alibaba-backed Paytm already lets users buy consumer goods, book tickets, hotels, and pay bills ranging from electricity to property tax on its platform.
“Paytm is looking to become a one-stop destination for consumers for everything they wish to do,” founder Vijay Shekhar Sharma said in a live broadcast on Twitter.
Paytm's new chat offering should be seen as a complimentary service, or as Sharma put it, like “soda to your food.”
Sharma said, in a live broadcast on twitter, that there are added advantages to having a chat service integrated with any kind of application. “We have a lot of things that the customer can do if messaging is integrated,” he added.
It should not be it be considered a challenger to WhatsApp and other messaging services, he said. Continuing with the culinary references, Sharma added, “Even if you come to our restaurant just for desserts, we'll be happy to serve.”
Sharma said Paytm will keep introducing new features in the chat, including mini-games and an air quality index.
India Added 1,000 New Startups In 2017
India witnessed the birth of 1,000 additional startups in 2017, on the back of a rapid rise in the number of new ventures in health-tech, fintech, e-commerce and aggregation verticals, according to the Nasscom Startup Report. The rise in registered startups has taken the total number of technology startups in the country to 5,200, further solidifying India’s position as the world's third largest startup ecosystem.
The number of fintech startups grew 31 percent in the year with $200 million in the first half of 2017, the report said. The number of healthtech startups also grew 28 percent with $160 million in funding.
India is one of the fastest growing start-up landscapes in the world and every major accelerator, investor, angel group, is participating in becoming a part of this growth journey.Raman Roy, Chairman, Nasscom
While India's startup hub Bengaluru maintained its position as the startup hub in India with Delhi and Mumbai close behind, 20 percent of the 1,000 startups were established in tier II and tier III cities, Nasscom said.
BloombergQuint spoke to Nasscom President R Chandrashekar on the sidelines of the event. You can watch the interaction here.
Revv To Have Mobileye-Powered Driver Assistance
After a successful 3-month pilot programme, Indian self-driving car rental startup Revv has partnered with Intel's Mobileye to install driver assistance systems in its cars.
Revv noted a 74 percent decline in accident rates during the 3-month period, said a company media statement. It had installed 30 vehicles with Mobileye's advanced driver assistance system (ADAS) and accidents reduced to one every 84,000 kilometres, from one in 22,000 kilometres earlier.
The startup is now rolling out the system across its entire fleet of 800 vehicles, the statement added.
Mobileye's ADAS alerts drivers of an imminent collision with a vehicle ahead or if it moves “dangerously close.” It also recognises speed limit signs and notifies the driver in case of overspeeding.
“India has only 1 percent of the world’s vehicles, but accounts for 10 percent of the world’s road fatalities. Given this, we felt that any step to increase the safety of our customers is a step worth taking,” Revv co-founders Karan Jain and Anupam Agarwal said in the media statement.
Jain also said that “given that the damage rates have gone down, the insurance claims on these vehicles have also gone down considerably” which will lead to lower insurance premiums in the future.