We have different business model than other digital wallet players: PayWorld CEO

Digital wallet player PayWorld is focusing on the financial inclusion theme to provide required financial services to those customers, who need assistance in performing a digital transaction. During the pandemic, its services have enabled many customers in rural hinterland and small towns to have access critical financial services like withdrawing money or sending money back home. In a conversation with Bizz Buzz, Praveen Dhabhai, CEO, PayWorld, said the company has seen good growth in business during FY21 with its GTV (Gross Transaction Value) touching around `9,000 crore and is confident of sustaining the growth in the current financial year. It has also entered into new segments like FASTag and is planning to come up with its RuPay card. PayWorld, which operate with other digital wallet players like Paytm, PhonePe, MobiKwik, have a different business model as compared to others and is a profitable entity. The firm is also considering going public in the next 3-4 years

How has the business performed during the pandemic year? Has it improved for PayWorld like other digital wallet players?

In PayWorld, we provide financial assistance to people who need it. There are a lot of people in the smaller cities and rural areas, who require assistance in doing financial transactions like sending money to their near and dear ones, doing a small insurance, small ticket investment in mutual funds, getting their bills paid or withdrawing money from retailers as they don't know how to operate the ATM. What we have done is that we have appointed 5,00,000 retailers across India who use the PayWorld platform to provide all the services, which I mentioned. For instance, many migrants working in other states don't know how to send money through net banking and they need assistance for sending money back home. Despite having smart phones or using many social media platforms, many don't know how to operate the net banking or invest in a financial product. So, they go to our retailers and our retailers do the transactions following all the Reserve Bank of India (RBI). We are also a digital wallet license-holder.

So, we have seen rise in our transactions during this pandemic. As we are essential services provider, we were operating during the pandemic. We provided all our retailers the passes to open their shops during the pandemic. During that period, cash was directly transferred to bank accounts as part of central government assistance. So, our retailers went to homes and helped people to withdraw money. In fact, our transactions increased during the pandemic. We also provide ticketing services for railways, which was hit during the pandemic. But, we have recovered in that segment also post the lockdowns. Overall, FY21 was a good year for us and we are confident of doing better in FY22.

Can you provide some numbers around how many transactions are you doing currently? What was the GTV (Gross Transaction Value) in FY21?

We do around 3 lakh transactions per day. In FY21, our GTV was around Rs 9,000 crore.

We have seen that competition is very intense in the digital wallet space with customer acquisition cost being very high. How was the case with PayWorld?

We do similar business as other digital wallet providers (Paytm, PhonePe) do. But there is a difference in our business model and we don't compete with them. The way we have implemented our business model is different from other players. Other players are acquiring customers, but we are not directly dealing with consumers. We are dealing with our retailers and the retailers are acquiring customers through their relationships. For retailers, it is a good opportunity as he earns fee income from those transactions. That's why, we have never made losses barring one year. We are profitable and one in the class in this category.

Which new services PayWorld has recently added?

We provide all services that other digital wallet service providers give. For example, we are now providing FASTag services. We are planning our RuPay card. Our target consumers are different. A small truck drivers or small cab driver don't know how to activate FASTag, put money in that account and our retailers help them to do that. This is a very large segment. So, we are doing financial inclusion by providing financial services to people who need assistance in doing those transactions.

PayWorld is also providing services DigiGold services that enable consumers to buy gold in paper form. What is the target consumer group here?

We are targeting lower middle class aspiring class who want to buy gold. In this segment, the customer can buy Rs 200 of DigiGold every month from our retailers. After one year, he can transfer the money to his bank account and withdraw it or buy gold from the invested amount. Similarly, he can small ticket insurance from retailers. We think that people don't want to save or invest because they don't have any avenues.

How many retailers are there on your platform? How many of them remain active per month?

We have close to six lakh retailers on our network out of which 1.1 lakh active every month. These retailers are spread across India. Active retailers do more than three transactions per month.

In the digital wallet space, Paytm and MobiKwik have filed for going public. Will PayWorld also consider to go public in the future?

Many players are planning to go public. We will see. We have not been funded by any private equity of venture capital funds. We are a profitable entity. We will consider going public 3-4 years down the line.

PayWorld has also entered into lending space. How is the segment performing for the company?

We have entered this segment pre-Covid through our partners. Under this segment, we provide loans to our retailers. Our retailers need cash flow loans because they have to do transactions. We were also running some pilots of giving small ticket loans to customers during the pre-Covid period. But these types of loans stopped by our NBFC partner during the pandemic. However, we will restart it next quarter.