Payments app, PhonePe, claims nearly 50% market share in UPI payments in India. Here’s
the amazing story of its founders who launched PhonePe after their first startup failed.
When Sameer Nigam and Rahul Chari established Flyte, a music downloading platform, while
working at Flipkart in 2012, the seeds of PhonePe were sown.
With the acquisition of MIME360, a digital media distribution company created by the couple,
Flipkart entered the online music store market in 2011. The initiative, however, did not go as
planned, and Flipkart was forced to shut down the firm due to a lack of payment and micro-
transaction options.
In a previous conversation, Sameer noted, “We were working in the music industry and learnt the
hard way that you don’t make money in the music sector easily.”
Sachin and Binny Bansal’s aim of establishing and growing the ecommerce platform “by putting
customer and technology first” prompted the duo to stay at Flipkart.
The duo realized the need for a platform that made financial services and payments simple after
seeing payment systems and gateways fail during the Big Billion Day sales in 2014.
This time, they sought to create a product that used technology “not as an enabler, but as its
raison d’être.” In 2015, Sameer and Rahul, along with Burzin Engineer, came up with the concept
for PhonePe, which they debuted in 2016. Their expertise at Flipkart, where they held numerous
positions, aided in the development and growth of PhonePe, as well as the identification of much
wider markets.
PhonePe announced a few days ago that it had reached the milestone of executing more than 100
million transactions in a single day. Last year, the Bengaluru-based fintech startup was valued at
$5.5 billion.
PhonePe is built on the National Payments Corporation of India’s Unified Payments Interface
(UPI), an instant real-time payment system. According to NPCI data, the Walmart-backed
business has the greatest proportion of UPI transactions in the country – close to 50%.
Sameer explained, “One thing I learned in the music industry was that if the pie is big enough,
you may meander around and strike gold.
The second is that we’re far better at constructing large-scale platforms, and as technologists, we
had a lot more fun building large-scale, massy, and high-social-impact platforms that ensured
fantastic experiences.”
He claimed they were “looking at partnering with a bunch of big banks on IMPS, establishing
that brokering layer that eventually became UPI itself.”
Sameer and Rahul were persuaded by the Reserve Bank of India’s and the National Payments
Corporation of India’s faith in UPI to give it a shot.
“A couple of the incumbents did not bite harder on UPI,” Sameer said, expressing surprise.
“It was really just the banks and us.”
“Perhaps individuals did not believe that all of the major banks would join UPI in a timely
manner,” he speculated.
Flipkart acquired PhonePe in 2016, and the company’s workforce joined Flipkart but remained to
function independently.
In 2017, demonetisation aided the company’s growth and acquisition of new users; it surpassed
10 million subscribers that year.
Sameer claimed they were “looking at partnering with a bunch of big banks on IMPS,
establishing that brokering layer that eventually became UPI itself.”
Sameer and Rahul were persuaded by the Reserve Bank of India’s and the National Payments
Corporation of India’s faith in UPI to give it a shot.
Expressing surprise, Sameer said, “A couple of the incumbents did not bite harder on UPI. It was
really just the banks and us.Perhaps individuals did not believe that all of the major banks would
join UPI in a timely manner.”
Flipkart acquired PhonePe in 2016, and the company’s workforce joined Flipkart but remained to
function independently. In 2017, demonetisation aided the company’s growth and acquisition of
new users; it surpassed 10 million subscribers that year.
The corporation announced earlier this month that it aimed to treble its employees by December
- It has 2,800 open employment opportunities across levels and functions for engineering,
product, analytics, business development, and sales teams in Bangalore, Pune, Mumbai, Delhi,
and the rest of the country that it hopes to fill in the next 12 months.
