Disruption in Mobile Payments PayThruMobile

Product
There are three important
players in the mobile payments
ecosystem Customers,
Vendors & Third Party App
Developer

Focus on Low failure rates and

scalability issues with proper
testing and regular updates for
bug fixes

Launch Basic features as part of

MVP and based on feedback
and adoption design new
features for later versions of
the application

Some of the features that will improve ease of use for all our customers
Customers
Low Payment Failure Rates, Easy Integration with existing Retail platforms
Expense Reports by Category (Shopping, Food, etc.) and ability to split with friends
Offer Lite versions of app for penetration in Low connectivity areas
Temporary connection with vendors via device pairing (One time Pass Code)
QR code/Bar Code compatibility for bill payments at various vendors ( Web Platforms)
Transactions on Deliver instead of COD to accommodate customer buying behavior

Vendors/Partners ( SMEs, Organized retail, E-Commerce players

Easy onboarding process along with authentication for registered partners
Revenue and profit details historic trends and other valuable insights
Ability to track customer related data such as demography, CLV, feedback
Suggestions based on market trends on promotions and pricing for products

Third Party Application developers

Application Programming interface (API) for easy integration with partner apps
Detailed documentation for easy adoption in the developer community
Dedicated staff for large partners to offer support and upgrades

Revenue Model
Total retail market size in India is
worth ~$600 bn and expected to
grow to $1 Trillion by 2020. ECommerce, Organized Retail and
Unorganized retail are the major
players in the eco-system

Mobile Payments Penetration is

depended on two factors

1- Internet/Smart Phone access

2- Sector & customer wise
adoption rates for different
segments

Major growth comes from

Mobile E-Commerce;
Unorganized retail though the
largest segment has lower
penetration possibility.
Organized players present
largest opportunity.

Current
2016
2017
2018
2019
Industry
Volume PentrationTotal
Volume PentrationTotal
Volume PentrationTotal
Volume PentrationTotal
Volume PentrationTotal
EWeb
15.00
2%
0.30
16.20
5%
0.81
17.50
8%
1.40
18.90
10%
1.89
20.41
0.15
3.06
Commerc Mobile
2.50
5%
0.13
2.88
10%
0.29
3.31
15%
0.50
3.80
20%
0.76
4.37
0.25
1.09
Organized
48.00
2%
0.96
57.60
5%
2.88
69.12
10%
6.91
82.94
15%
12.44
99.53
0.20
19.91
Retail
Unorganized 552.00
0%
0.00
623.76
1%
6.24
704.85
3%
21.15
796.48
5%
39.82
900.02
0.08
72.00
Total
1.39
10.22
29.95
54.92
96.06
Processing Fee
2%
2%
2%
2%
2%
Revenue
0.03
0.20
0.60
1.10
1.92

All values in $ Billion, assumptions in appendix

We see a revenue potential of $0.03 bn in current yr and $1.92 bn dollar by 2019

Other potential sources of revenue
We can provide value added
services (Analytics, Development
support) to vendors and charge
monthly subscription.

Encourage customers to use wallet for

Savings and offer 5-6% interest. Based
on market cost of capital, company
can make 3-4% commission on savings.
Encourages more Wallet transactions
too.

Partnering with Government Welfare

Schemes to transfer benefits and
assistance on mobile wallet will increase
adoption and penetration in lower income
segments.

Execution and Operation

Three stage process for adoption among merchants
Partner with initial customer based to evaluate the benefits of the model through data collection and
building trust. Evaluate pros and cons to modify execution strategy
Offer them subsidy on transaction fee or a free trial period to evaluate the wallet payment channel

Trial
Share

Scale

Share the benefits report for the existing customer based to provide social proof and revenue potential
Offer bonus to current vendors through referral scheme ; increase adoption in unorganized retail market

Deploy sales team in major metro cities and slowly scale to tier 2 and tier 3 to capture larger market.
Provide incentives to the vendors on transaction fee based on usage to increase loyalty and create
barriers to entry for other players.

Estimating Sales Representative required in city with 400 sq km area, with 4000 merchants.
No . of stores covered by a sales rep in a week : 10 stores (for onboarding and benefits shares)
Target Inorganic growth is 20% of 4000 merchants -> 800 stores
Target 3 months, merchants covered by one sales rep in 12 weeks > 120-150 , number of sales rep required 6-7

Sample Org Structure

Regional Sales
Manager

Sales Rep

Sales Rep

Sales Rep

Size of sales team for a city 8-9

Number of cities will expand as we scale up.
Start with 10 cities to try the pilot and scale
based on success of the model

Marketing and Promotion

To Customers
Marketing strategy should be
chosen to target specific
customer segments on both
sides of the network (Buyers,
Sellers)

For Urban Customers Referral

marketing is more effective.
This allows for exponential
growth in no. of new customers
acquired.

Customers will be more willing

to try the Wallet due to free
wallet money provided to them
initially. Incentive amount can
be decided based on potential
CLV of customers.

Partner with large Retail brands

for capturing the share of mind
in their loyal customers.
PayTrhuMobile can leverage on
the brand image of these
players.

Partner with Large Banks to

allow users to convert reward
points to wallet money for
increased flexibility to
customers.

Promotion in Rural market

through mass media and
celebrity partnerships. Will
increase awareness and then
referral can improve growth.

To Vendors/Partners
Promote benefits such as
ease of transactions and
money management for
vendors

Offer referral benefits to

SMEs for increasing adoption
and improve the growth of
sellers on network

0% transaction fee for new

vendors for a certain trial
period to make them
evaluate the benefits.

Merchant Operations & Risk Management

Customer

Merchants

Identifying Sources of Risk in the Eco-System and Mitigating them

Source
Solution
Failure of Transactions
Fast detection and returns of money to wallet ASAP
Fake Merchants can register PAN, TAN, Adhar for Merchants while onboarding
Risk of Churn for merchants Loyalty Bonus, Decrease transaction fee after a certain minimum transactions

Low adoption rate

Increase sellers on your platform and provide free trial in initial days
Customer churn - low clv
Provide rewards and referral benefits for engaging the customer
Interaction with SME for payment
Provide one time connection request based on location to imporve adoption

Organizational structure to deal with the risk

1- 24x7 customer service for merchants and customers
2- Support to developer community online query and discussion forums.
3- Risk Recovery and Root cause analysis teams to identify new source of risk and
resolutions
4- Merchant onboarding team to authenticate and train merchants

Assumptions and Appendix

Assumptions for Financial calculations:
1- The volume of transactions on wallet is calculated as a product of = Retail Sales *
Penetration of wallet payments ( Penetration is estimated based on internet coverage
and market share)
2- 2% processing fee is assumed on each transaction to be competitive with other
players such as Credit Cards and other Mobile wallets.
3- GDP Growth rate and segment wise growth rate is estimated based on industry
reports.
Appendix:
1- www.statista.com for statistics on Indian Retail market
2- RBI reports for GDP growth and retail market expense.
3- Penetration for different segments through news articles and wikipedia.