Flipkart Launches Super.Money: Is the Indian E-commerce Giant Late to the UPI Party?

Flipkart's entry into the fintech sector is poised to shake up the duopoly of PhonePe and Google Pay in India's UPI market. Leveraging its extensive user base from Flipkart's e-commerce platform, Super.Money has the potential to significantly reshape the current market dynamics.

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India’s fintech sector is witnessing a surge of new companies aiming to capitalize on the industry’s rapid growth and gain a sizable market share. Among these, e-commerce giant Flipkart is re-entering the fintech arena with the launch of its own UPI payments app, Super.Money. This return is noteworthy as Flipkart had previously established a strong foothold in fintech through its acquisition of PhonePe in 2016.

However, after operating as a subsidiary for five years, PhonePe spun off from Flipkart in December 2022, leaving a gap in Flipkart’s fintech presence.

The Super.Money app, currently available in beta on the Google Play Store, offers a wide range of digital financial services, such as payments, credit, and deposits. The app focuses on UPI payments, India’s most popular digital payment method, ensuring seamless and instant transactions.

To deliver its financial services, Flipkart has partnered with several banks, including Utkarsh Small Finance Bank, IndusInd Bank, and Axis Bank. These collaborations enable Super.Money, a Flipkart group company, to offer a variety of services such as pre-approved credit offers, fixed deposit accounts, and, in the future, secured credit cards.

One of the standout features of Flipkart’s UPI app is its promise of “real cashback” instead of loyalty points or other rewards programs. This strategy provides users with a more practical and immediate incentive.

Why is Flipkart Re-entering Fintech?

Flipkart’s return to fintech is a strategic move driven by two major factors: diversification and market expansion.

Firstly, Flipkart aims to broaden its revenue streams by venturing into emerging sectors such as quick commerce, digital lending, and food and beverage (F&B). Recognizing the growth potential of companies like Blinkit, Zepto, and Paytm in the lending space, Flipkart seized the opportunity to meet the increasing consumer demand for loans.

It is important to note that after its separation from PhonePe, Flipkart had no immediate plans to re-enter the mobile payments market. However, in July 2023, the e-commerce company entered the lending space with a strategic partnership with Axis Bank.

In March 2024, Flipkart launched a UPI handle @fkaxis for limited users. Within two months, in May 2024, about 4.44 million transactions worth Rs 251.85 crore were recorded on the app. This success likely fueled Flipkart’s decision to launch the full-fledged Super.Money app.

Secondly, Flipkart, with a large user base in tier-2 and tier-3 cities, is well-positioned to expand access to financial services like credit and fixed deposits.

Partnering with various banks like Utkarsh Small Finance Bank allows Super.Money to offer these services to wider, previously underserved customers in India.

Leveraging a Strong User Base for Fintech Advantage

Prakash Sikaria, founder of Super.Money, has been instrumental in building the payments app from scratch. Flipkart has invested around $20 million in this new venture, signalling its serious commitment to the fintech space. This investment reflects the company’s strategic vision to innovate and expand its service offerings beyond traditional e-commerce.

According to AllianceBernstein, Walmart-owned Flipkart is currently dominating India’s e-commerce market with a 48% market share. The platform’s user base has surged an impressive 21% YoY in 2023, compared to Amazon’s 13% YoY user growth.

Another report from Bank of America highlights Flipkart’s popularity among Indian consumers, noting that it has more than twice the daily active users of Amazon India. With such a robust foundation, Flipkart’s entry into the fintech sector is poised to shake up the duopoly of PhonePe and Google Pay in India’s UPI market. Leveraging its extensive user base from Flipkart’s e-commerce platform, Super.Money has the potential to significantly reshape the current market dynamics.

It is worth noting that Flipkart is not the only major player exploring fintech. Reliance’s Jio Financial Services recently launched its payments app, indicating a growing trend among industry giants to capitalize on India’s digital financial boom.

Late to The UPI Party?

There is no doubt that Flipkart is trying to leverage millions of existing shoppers who are being served daily. The company is trying to grow horizontally by making these shoppers reimagine UPI Payments with the help of Smart.Money. Be it credit card payments, online shopping or personal loan payments, UPI sits at the core of Super.Money.

Many experts, however, argue that it’s a bit late for Super.Money to jump into this market. Considering that millions of users have already found their comfort zone while making UPI payments with Google Pay or PhonePe, it would be an uphill battle for Super.Money to make its presence felt and convince users to shift their loyalty.

To understand it deeply, let’s examine a few UPI numbers and how the leading UPI Players have fared!

In May 2024, 14.04 billion UPI transactions in India were processed by over 70 UPI apps fighting with each other to claim a sizeable share of the market. Interestingly, only two apps account for double-digit market share, collectively processing nearly 9 out of every 10 UPI transactions. The rest of the apps, despite putting their best foot forward, have failed to emerge as a threat – let alone breaking – to the duopoly of PhonePe and Google Pay.

For more data infographics, please follow #DGraphics

The challenge for Flipkart Smart.Money will not be any different. Entering an already crowded market and capturing a sizeable share of it will be a difficult and long battle to get involved. Perhaps the only way would be for shoppers to not have a choice but to use Smart.Money while choosing to make a payment by UPI. However, it’s quite unlikely that regulators would allow this.

The Road Ahead

The success of Flipkart’s UPI app, Super.Money, hinges on its ability to deliver a user-friendly and rewarding experience while expanding its service offerings. The app’s integration with Flipkart’s existing ecosystem and leveraging its vast customer base will play pivotal roles in the company’s quest to capture substantial market share.

India’s fintech sector is witnessing intense competition and innovation with players like PhonePe, Google Pay, Reliance Jio, and now Flipkart. This competitive environment is set to drive advancements that ultimately benefit customers through improved services and innovative solutions.


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