Also in this letter:
■ ONDC to publish draft on dispute resolution in two weeks
■ Europe’s energy crisis weighing on IT firms’ outlook, analysts say
■ Demand for industry-ready techies remains robust despite hiring slowdown
NPCI consults govt, stakeholders on UPI market-share cap amid extension requests
The National Payments Corporation of India (NPCI), which runs the Unified Payments Interface (UPI), is talking to the government and industry stakeholders on the implications of delaying its implementation of a market-share cap for UPI apps, people briefed on the matter told us.
Catch up quick: The NPCI has set a limit of 30% market share on UPI for any digital payments entity. The rule is set to take effect from January 2023.
PhonePe and Google Pay, on average, have a share of about 80% on the digital payments network each month. While PhonePe clocked 3.14 billion UPI transactions in August, giving it a 48% market share, Google Pay recorded 2.2 billion transactions for a 34% share, according to data from NPCI.
Driving the news: The latest discussions follow a formal request from PhonePe to defer the January 2023 deadline by at least three years, they said. Google Pay has also had consultations with NPCI regarding an extension, a source told us.
A spokesperson for Google Pay said, “While it is our belief that at this juncture, interventions in UPI should spur growth and innovation than limit it, which we think the market cap might do, we remain committed to complying with the laws of the country.”
New entrants: WhatsApp Pay, a relatively new entrant, garnered less than 1% of the overall UPI market in August, with only 6.72 million transactions, despite launching successive cashback campaigns in April and June that led to a small spike in numbers.
Tata group’s super app Tata Neu also joined UPI earlier this year but hasn’t seen any noticeable traction yet.
The total number of UPI transactions in August stood at 6.5 billion.
Swiggy, Zomato eye UPI: NPCI’s move comes at a time when at least two more consumer internet platforms – Swiggy and Zomato – are thinking of making a foray into UPI as third-party payments apps, sources aware of the matter told us.
ONDC to publish draft on dispute resolution in two weeks
The Open Network for Digital Commerce (ONDC) will publish a draft framework for dispute resolution in two weeks, a top executive said, as it seeks to boost consumer trust in the ambitious initiative, which is slated to go live later this month.
Details: The online dispute resolution (ODR) will be handled by a third-party agency that will review the digital trail left behind by individual orders and take a call.
Consumers will be able to track the status of complaints, how many are resolved, and will be involved in the final rating of merchants on the network, ONDC chief executive T Koshy told us.
ONDC will also record all complaints filed against a particular entity, linked directly to the network-wide reputation index that tabulates percentages of complaints raised, resolved or not resolved, as well as those that consumers may choose to take to consumer courts.
The draft document will be based on the ODR Policy Plan published by an expert committee of the Centre’s public policy think tank Niti Aayog in October 2021.
Why it’s needed: ONDC’s move comes amid a debate on the need for a robust dispute resolution framework if ONDC is to compete effectively against the likes of ecommerce majors Amazon and Flipkart.
Niranchana Karthik, managing director of Digiit, one of the seller-side apps on the network, said, “Since ONDC unbundles transactions, grievance redressal is very important for each system to be a success post the order. Be it at the buyers’ side, the sellers’ side or at the end of the logistics service providers, payments, settlements and dispute management have to be handled smoothly. This framework gives guidance for every player based on the role they play.”
Europe’s energy crisis weighing on IT firms’ outlook, analysts say
The energy crisis in Europe and macroeconomic headwinds are weighing on the outlook for IT service segments like retail, manufacturing and automotives, analysts told us.
Driving the news: There has been a slowdown in decision making across these sectors, especially in Europe, said IT consultancy firm ISG. Firms across the European Union and UK are under severe cost pressure, other analysts said.
Europe accounts for over 25% of the revenue pool of Indian IT service providers like Tata Consultancy Services (TCS), Infosys, and Wipro among others, with many of them dealing with global retailers, manufacturers and automakers in the region.
High inflation: In August, inflation in the euro zone touched 9.1% due to spiralling fuel prices, forcing many small businesses to suspend operations. However, Indian IT service providers generally engage with the larger companies in this space.
Outsourcing firms to benefit: However, Indian IT service leaders including TCS, Infosys and Wipro will continue to be in a sweet spot due to a preference for outsourced solutions during uncertain economic activity.
Demand for industry-ready techies remains robust despite hiring slowdown
Demand for industry-ready IT professionals, essential for business continuity, remains robust, bucking evident sluggishness in job additions in the technology industry, which is the biggest laggard on the stock markets this year – both in the US and India.
Driving the news: About half a dozen industry experts ET spoke with said professionals engaged in roles such as full-stack development, DevOps, data engineering, quality assurance, testing, cloud, infra, digital engineering & IOT/Mobile/5G skills, tech leadership and architecture, IT infrastructure specialism, UI/UX design, risk analysis and security administration continue to be in high demand.
“While the hiring landscape will revive in a few quarters, the need for skilled, industry-ready talent will always be the need of the hour, across domains in the IT sector,” Srikanth Karra, chief human resources officer, Mphasis, told us.
Overall, IT hiring declined 15-30% in July and August compared with the monthly average of April, May and June due to uncertain geopolitical scenario, inflationary pressures and a threat of recession, according to a study by CIEL HR Services.
TWEET OF THE DAY
Insurtech platform Zopper raises $75 million led by Creaegis
Solvy Tech Solutions, which runs insurtech platform Zopper, has raised $75 million from investors led by Creaegis to fund its expansion plan.
The funding round saw participation from ICICI Venture and Bessemer Venture Partners, and existing backer Blume Ventures, the company said.
Zopper cofounder Surjendu Kuila told us the capital would be used to support its international expansion, beef up the platform’s technology and data engineering functions, and for strategic acquisitions.
By the end of the current fiscal, the headcount at Zopper is expected to grow from 475 to more than 600. Most of the hiring will be across functions of technology, data science and data engineering, the company said.
Zopper, founded in 2011, provides an application programming interface (API)-based software platform which connects insurers and banks with third-party platforms. Through the integration, it allows these platforms to embed and distribute insurance products to their customers.
Good Glamm in talks to acquire Twinkle Khanna’s Tweak India
The Good Glamm Group is in talks to pick up a majority stake in a digital content firm founded by Bollywood actor Twinkle Khanna, people familiar with the development told us.
Acquisition spree: If the transaction of Tweak India goes through, it will be the 11th acquisition by the content-to-commerce company.
Details: “It is a cash-plus-stock deal and it is in the final stages of documentation,” said a person in the know of the matter.
Tweak India is a female-focused multimedia platform across text, video, podcasts, radio, and event formats, with a focus on wellness, beauty, and an eco-friendly lifestyle.
Following the acquisition, Tweak India will be housed under Good Media Co, led by Priyanka Gill. Khanna will continue to lead Tweak India as its CEO, the sources said.
The Good Glamm Group, which was last valued at $1.2 billion, has had trouble raising new funds as late-stage financing has dried up, with investors steering clear of loss-making tech firms, as we reported on September 6.
ET Ecommerce Index
We’ve launched three indices – ET Ecommerce, ET Ecommerce Profitable, and ET Ecommerce Non-Profitable – to track the performance of recently listed tech firms. Here’s how they’ve fared so far.
Other Top Stories By Our Reporters
Sebi puts GoDigit’s IPO on hold: The Securities and Exchange Board of India (Sebi) has put on hold the proposed initial public offering (IPO) of GoDigit, which is backed by Canada’s Fairfax Group. Digit Insurance filed draft documents for its IPO in August, looking to raise Rs 1,250 crore from a fresh issue of shares and an offer for sale (OFS) of 10.94 crore equity shares.
CityMall conducts first Esop buyback: Social commerce platform CityMall said it has conducted its first employee stock ownership plan (Esop) buyback, worth $1.3 million. More than 50 employees across its senior management and core team participated in the programme, the company said.
Oyo restates FY22 losses to Rs 2,140 crore, files fresh IPO docs: Hospitality firm Oyo has reported revenue from operations of Rs 1,459.3 crore in first quarter of the financial year 2023 according to an addendum filed with Sebi. Its restated loss for the quarter from continuing operations was at Rs 414 crore, even as the company claimed this was its maiden Ebitda-positive quarter.
Nutanix India business outpaces other markets: Nutanix said its India business – which grew at over 60% in the past year — was outpacing that in other geographies. The surge in digital adoption that began during the pandemic continued in India, with the enterprise cloud computing firm continuing to add new customers in the country, Aaron White, recently appointed vice president and general manager, APJ sales at Nutanix, told us.
Global Picks We Are Reading
■ China’s factories accelerate robotics push as workforce shrinks (WSJ)
■ For Myanmar’s revolutionaries, adopting digital currency can mean life or death (Rest of World)
■ Everyone knows what YouTube is — few know how it really works (The Verge)
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