The Japanese firm last month launched a parking app, it is in the midst of rolling out a taxi-hailing service in conjunction with China’s Didi Chuxing and now it is developing a mobile payment service, too.
Bloomberg reports that Softbank is working with India’s Paytm — a startup that counts long-time SoftBank ally Alibaba as its main investor — to introduce a payment service before the end of this year. A source close to the companies confirmed the plans to TechCrunch, adding that an official announcement is expected very soon.
The plan is to start out with payments before moving into financial services, such as loans and insurance. The Japan launch would then be a springboard to expand to other global markets in the future, according to the Bloomberg report. Although it isn’t clear how the service would compete with offerings from Ant Financial, the Alibaba fintech affiliate that has local operations spread across numerous countries in Asia.
Paytm was the first mobile payment service to reach meaningful scale in India. Today it claims over 100 million registered users, thanks to a surge in adoption following the Indian government’s 2016 demonetization campaign which removed 500 INR and 1,000 INR notes in a bid to crack down on illicit usage and counterfeit cash.
The company recently claimed to have hit an annual run rate of five billion transactions, and reached $50 million in gross transaction value over the past twelve months, but Paytm has plenty of competitors waiting in the wings. Google’s Tez app has now passed 50 million downloads, while rivals such as MobiKwik hope Paytm’s focus on services like shopping will present a window to out-perform it on payments.
Japan will be Paytm’s first major international expansion — it has a modest service in Canada, where it has an R&D team — but even then there’s plenty of others in the market. Those include the likes of Line, Japan’s top chat app, and e-commerce giant Rakuten.