 "Mayank Jain, Director, Credit & Lending, Amazon Pay India")
Amazon Pay, the payments and financial services arm of e-commerce giant Amazon, is looking to ride the wave of credit on the Unified Payments Interface (UPI) as early as the first half of 2024. The company aims to expand the usage and coverage of credit with this feature.
“The idea is to expand access to credit. It is not just to cater to credit-served customers. I see the biggest promise of the UPI credit line is to expand the usage of credit as well as the coverage of credit,” said Mayank Jain, director-credit and lending, Amazon Pay India, in an interaction with Business Standard.
In September this year, the National Payments Corporation of India (NPCI) announced the launch of a credit on UPI feature at the Global Fintech Fest in Mumbai.
Jain said the company is working with banks and NPCI to introduce the product to its customers in the first half of 2024.
Amazon Pay operates credit products such as a co-branded credit card and a ‘buy now, pay later’ product called Amazon Pay Later, among others.
The company has registered over 8 million customer sign-ups on Amazon Pay Later, whereas the Amazon Pay-ICICI Bank co-branded credit card has a base of over 4 million customers.
“With the UPI credit line, we could see the numbers multiply very soon within the next two to three years. Millions of customers who have a savings account with a bank will get pre-approved credit lines. I believe this number will be a few hundred million customers, if not tens of millions,” Jain added.
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Meanwhile, Jain believes it is business as usual for the company in the backdrop of the Reserve Bank of India (RBI) increasing the risk weighting for unsecured personal loans and those on credit cards from 100 per cent to 125 per cent.
“Players with irresponsible lending practices having bad debts or high loss rates need to worry about it. We have a healthy risk performance for our programmes with the lenders. If one had poor loss rates, then things would have changed. But nothing changes for us now,” he added.
He added that the company is focused on transactions beyond just its parent e-commerce platform Amazon.
“Amazon India is not the only priority for Amazon Pay. The company is trying to serve a larger audience and is now able to offer customers who have signed up for our credit lines to use them at other merchants and not just at Amazon,” he explained.
For instance, for every transaction carried out using the Amazon Pay-ICICI Bank co-branded credit card on Amazon, it records four transactions outside the platform.
Moreover, Jain adds that it is the right course of action to allow customers to choose their preferred network for credit cards.
“The idea was that banks need to offer more than just one network. They need to offer multiple networks. I think that’s coming from a very customer-centric view of saying customers should have a choice. Our bank offers cards with all partners, including RuPay, Visa, and Mastercard,” he elaborated.
In July this year, the RBI released a draft circular on changing the arrangements between card networks, banks, and non-bank entities authorised to issue cards.
According to the notification, cards must be issued across multiple networks, and issuers must give their customers the option to choose one from them.
