Discover more from Recursive Function
Indian Digital Payments are Broken
The payment app ecosystem in India is broken... this is going to be a "rant" today.
The payment app ecosystem in India is dysfunctional. It's a daunting task to find an app that allows for easy UPI payments without being inundated with a plethora of products. Good luck convincing elderly individuals to use UPI now!
What's Wrong with "The Trinity"?
🔴 Take Phonepe. I can never find the "scan" or "pay to a phone number" button without spending a hot minute reading through their number of useless offers. It often would be tucked in a small corner among coloured buttons, littered across the screen, designed to draw your attention away from what you wanted to do — may a payment.
🔴 Now take its major competitor, Paytm. They force full-page gambling ads and weird offer banners, hiding the payment buttons. And after you manage to locate it, you receive yet another barrage of ads, spin wheels, cashback animations, and more products to buy, even before confirming your payment 🤦♂️. The only good thing is they have the best reliability.
🟠 Google Pay fares better in this regard, but still too many distractions with energy, diyas, mangoes or whatever mini-game they want to develop that week — still a massive welcome change from the Phonepe-Paytm chaos. Unlike others, You can still locate the pay button, which isn't lost in the sea of offers. However, the only big negative of Google Pay — is the neverending saga of payment failures 🤷♂️.
🏦 Bank apps are a bug fest 🐞, and by the time you reach the UPI page, they time out before you complete payment due to sEcUriTy 😡!!!
And BHIM, the OG UPI app, which was dead simple in 2016 even for my grand-parents has slowly turned to the Paytm or Phonepe way with an even worse experience because they don't use the system keyboard (for sEcurITy ofc) and typing anything is a nightmare.
Is there an app that is simple, easy to use and distraction-free?
At this point, I’m actually hoping if Apple Wallet launches in India with UPI. There has been talks about an Apple Card in partnership with HDFC Bank, I am going to assume they won’t have an agenda to sell products (other than the hardware), hence probably provide a service that’s simple and useful.
The real reason why all this happens is the 0 MDR regime. Unlike the case of MDR in credit or debit cards, our government doesn't allow UPI payment service providers to charge a transaction fee.
So, if you as an app want to make money, you must not allow users to make a payment and instead sell whatever you have at any cost and hope some users bite the bullet. Be it BNPL, loans or bill pay. 💸 No wonder some payment apps are struggling too — remember FreeCharge and MobiQuik?
PayZapp is the only app I know that still maintains the sanity of a payments app and offers all essential features (Scan, Pay to mobile, Credit cards, BBPS etc.). It has been my primary for a while now. The transaction failure rates are slightly worse since it runs on the HDFC network.
Thanks for reading Recursive! Subscribe for free to receive new posts and support my work.