“Paytm, the troubled mobile payments company, has been experiencing a gradual decline in both value and volume market share within India’s digital bill payment landscape, as indicated by data from the Bharat Bill Payment System (BBPS) website.
BBPS serves as a centralized platform connecting utility companies or billers with banks and customer payment apps, handling over 80 percent of all online bill payments in the country.
In March 2024, Paytm’s market share in bill payments dropped to 10 percent by volume compared to its 13 percent share in January. Similarly, its share in terms of the value of bills paid decreased from 10 percent in January to 7 percent in March 2024.
While Paytm has faced challenges due to regulatory actions on its associate company, Paytm Payments Bank Limited (PPBL), its market share decline predates these measures. PPBL, which held Paytm’s mobile wallet license and powered UPI payments on the Paytm app, was affected by regulatory actions.
A year ago, Paytm held approximately 14-15 percent market share in bill payment value, which has now halved to 7 percent.
In January 2023, Paytm facilitated 13 million bill payments, which increased to 16 million in January 2024 but dropped to 14 million in March 2024. Meanwhile, the total number of bills paid on BBPS increased from 100 million in January 2023 to 137 million in March 2024.
In terms of value, Paytm processed bills worth Rs 2,370 crore in March, down from Rs 2,911 crore in January.
The decline in Paytm’s bill payment market share could also be attributed to the disruption caused by the loss of its Operation Unit license held by PPBL. As a result of regulatory actions, Paytm transitioned from a Bharat Bill Pay Operating Unit (BBPOU) to an Agent Institution (AI), slowing down bill payment processes and increasing the risk of payment failures.
This decline mirrors Paytm’s situation in UPI payments, where it has lost five percentage points in market share over the past year, now holding a market share of 8.4 percent in April 2024 compared to 13.3 percent in April 2023.
PhonePe and Google Pay have been gaining market share in both UPI payments and bill payments, reflecting the increasingly duopolistic nature of the UPI ecosystem, where these two apps control close to 90 percent of all transactions.”
