Google and Walmart Push India’s Billionaires Out of Mobile Payments
As the government tries to get more Indians into the financial system, deep-pocketed rivals are dominating the market.
If there’s any nation where it seems fortunes could be made by getting in early on digital payments, it’s India. The population of 1.4 billion is still wedded to cash, which accounts for about 70% of transactions by value. But the government is trying to get more people into the formal financial system.
After the Reserve Bank of India created a new kind of bank in 2014 just for handling consumer payments, India’s business titans piled in. Many may now regret it. At least five firms that won Indian licenses to handle interbank mobile and online transactions have shuttered operations or frozen investment, three of which are backed by some of the nation’s most prominent businessmen. Dilip Shanghvi, worth an estimated $7.3 billion, pulled the plug on his payments bank before it even launched after realizing how much cash the business would burn.