E-wallet Companies Struggle in India, as Initial Euphoria Dies Down
After a flurry of activity with almost two dozen companies launching prepaid wallets in the last couple of years, the initial euphoria around wallets may be dying down. Many players — with the exception of dominant Paytm or -owned Freecharge — concede that the numbers of wallet users is stagnating and companies are struggling to get existing users to transact more using their digital money.
While no one has called it quits so far, even players with significant number of wallets such as PayU Money and Citrus told ET that they are not aggressively pushing their own wallets anymore and are unabashedly aligning with rival wallet firms.
“The pre-paid wallet story is an extremely weak story,” Nitin Gupta, CEO of PayU Money told ET.
The Indian financial services market is hugely underpenetrated and the opportunity is very big. “EWallet became the back door entry route for companies into financial services, but they are realising now that not many people are interested in it,” said Gupta. The RBI gave licence to operate pre-paid wallets to around 26 entities and the last two years have seen a flurry of launches from organisations ranging from Ola to conglomerates such as Spice group to several banking and finance firms.