Google is increasing its push into client finance in India with the launch of a UPI-linked bank card, betting on a rustic of greater than 1.4 billion individuals the place fewer than 50 million at the moment maintain a bank card.
On Wednesday, Google entered India’s rising co-branded bank card market with the launch of Flex by Google Pay, partnering with non-public lender Axis Financial institution to develop entry to credit score within the nation’s UPI-driven funds ecosystem.
India’s fast adoption of digital funds by the government-backed Unified Funds Interface (UPI) has reworked how customers pay however has not translated into broad entry to credit score. That hole has created a chance for know-how corporations and banks to embed lending into extensively used funds apps, serving to clarify Google’s transfer into the house.
Flex by Google Pay is issued digitally by the Google Pay app and can be utilized each on-line and at bodily retailers, the corporate stated. Constructed on the Indian government-backed RuPay community, the cardboard features a rewards program that credit digital “Stars” on transactions, with every Star price ₹1. Customers can monitor spending and payments inside the app, select to repay balances in full or convert them into installments, and handle safety settings reminiscent of blocking the cardboard or resetting a PIN.
The launch builds on Google Pay’s broader effort to develop entry to credit score in India, the place it has already partnered with banks and non-bank lenders to supply private and gold-backed loans by the app. As one of many nation’s most generally used UPI platforms, Google Pay affords Axis Financial institution entry to a big, digitally lively consumer base at a time when lenders are more and more seeking to scale credit score distribution by know-how platforms somewhat than bodily branches.
Whereas Google has began with Axis Financial institution, it goals so as to add extra issuer companions quickly to develop its co-branded bank card providing in India.
Pricing on the cardboard, together with curiosity and relevant expenses, will range by consumer and credit score profile, with no software price, Google stated, including that expenses linked to reimbursement selections are proven upfront within the app. Processing charges apply to EMI conversions, and late-payment expenses will probably be levied according to the issuing financial institution’s coverage.
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India’s bank card market has been increasing quickly in recent times. The variety of excellent playing cards has grown at an annual price of about 14% over the previous three years to round 110 million, whereas transaction volumes and values have risen at near 30%, per a latest PwC report (PDF). Common annual spending per card has elevated from about ₹132,000 (round $1,450) to roughly ₹192,000 (about $2,100), suggesting playing cards are getting used extra regularly for routine funds somewhat than occasional big-ticket purchases.
Regardless of progress within the variety of excellent playing cards and bank card spending in India, the enlargement has largely been pushed by present customers somewhat than a significant improve within the variety of cardholders. Google goals to assist tackle that hole by bringing new customers into the credit score system, notably these cautious of conventional card reimbursement buildings. “It’s the identical customers getting increasingly more credit score,” stated Sharath Bulusu, senior director of product administration for Google Pay, including that versatile reimbursement choices are designed to ease considerations round unpredictable billing for first-time credit score customers.
“We expect we now perceive the issue, the house, and the consumer effectively sufficient to resolve one thing uniquely for them,” Bulusu informed TechCrunch, explaining Google’s timing.
Google’s transfer comes amid rising competitors in India’s co-branded bank card market, the place corporations together with Amazon, in addition to Walmart-owned Flipkart and PhonePe, already provide related merchandise. Client web platforms reminiscent of meals supply companies Swiggy and Zomato, together with on-line journey corporations together with MakeMyTrip and Yatra, have additionally entered the house in partnership with banks.
Co-branded bank cards accounted for about 12-15% of India’s complete bank cards within the monetary 12 months ended 2024 and are projected to seize greater than 1 / 4 of the market by quantity by 2028, rising at an annual price of 35-40%, in response to a report (PDF) by consultancy agency Redseer.
Alongside the co-branded card launch, Google can be rolling out “Pocket Cash,” a characteristic within the Google Pay app that lets dad and mom give kids restricted entry to digital funds. Constructed on the just lately launched UPI Circle performance, the characteristic lets dad and mom set a month-to-month spending cap of as much as ₹15,000 or approve particular person transactions initiated by the kid.
Dad and mom obtain notifications for every transaction and might view spending historical past or pause entry to the characteristic by their very own Google Pay app, the corporate stated. The transfer may additionally assist Google broaden Google Pay’s utilization and addressable market in India, the place it competes intently with Walmart-backed PhonePe among the many nation’s main UPI platforms.
Google’s Pocket Cash characteristic follows earlier efforts by Indian fintechs reminiscent of FamPay and Junio, which sought to allow kids’s digital spending by pay as you go playing cards. Nevertheless, in contrast to pay as you go devices, Google makes use of the UPI Circle framework to let dad and mom retain management of funds till the second a transaction is made, somewhat than loading cash prematurely.
“With UPI Circle, the cash stays within the mum or dad’s account till it’s spent,” Bulusu stated, including that the strategy makes it simpler for households already comfy utilizing Google Pay to introduce kids to digital funds. He stated the characteristic displays a broader wager on acquainted funds apps as a technique to construct monetary confidence amongst youthful customers as digital funds change into extra pervasive.
Google can be upgrading the expertise for small companies on Google Pay, permitting clients to price retailers instantly after a transaction, with these opinions syncing to the service provider’s Google Maps itemizing. The corporate can be rolling out an AI-powered promoting characteristic inside the Google Pay for Enterprise app that assists retailers in creating and launching adverts.
Greater than 530 million distinctive customers have made a minimum of one cost by Google Pay, whereas over 23 million small retailers have been onboarded to the platform over time, Bulusu stated. That attain, he added, provides the corporate confidence it could actually introduce new monetary merchandise to customers already comfy transacting digitally.
