Flipkart’s PhonePe enters the digital gold market

By

Maverick Martins

Published
Dec 13, 2017

PhonePe, the digital payments entity of e-commerce major Flipkart, has entered the digital gold segment in Indian in collaboration with Safegold. Flipkart will now compete for market share in the digital gold space with Paytm.
 

Digital payments platform Paytm has already got a head start in the digital gold segment as it entered the market in April through a partnership with Indian gold refinery MMTC-PAMP. Paytm has already sold gold worth Rs 120 crore (approx $18.5 million) on its platform since launch of its gold offering to customers.
 
PhopePe will look to replicate the same with its gold offerings and likely to cause a dent into Paytm’s gold offerings which had set a target of selling 5 tonnes of digital gold valued around $200 million this year. The Flipkart firm will allow consumers to buy 24-karat gold worth any amount as per the existing gold market prices.

As India is the world's No 2 consumer of gold behind China, companies like Phonepe and Paytm see huge potential in the digital gold market as it will help boost revenue and also acquire new customers.
 
“We are focused on creating multiple use cases for consumers. We did credit card payments on PhonePe app and now digital gold is an addition in that direction,” said Hemant Gala, head of banking relations and strategic partnerships at PhonePe in a statement.
 
“We are already seeing an average transaction value of Rs 1,500 on our platform which is much higher than standalone wallets. We hope that with these trusted names consumers will engage more with our platform through the digital gold product," Gala added.
 
In October, Flipkart had made a capital infusion of $500 million (approx Rs 3243 crore) to its digital wallet firm PhonePe to scale up its up technology, reach and offerings. PhonePe with its new gold offering will now look to leverage its e-wallet to let customers buy and sell gold.