Alibaba-backed payment and commerce company Paytm has found a serious competitor in Mukesh Ambani-promoted Reliance Jio. The latter has recently entered into a partnership with the American cab-hailing company Uber, signalling a larger battle in India's digital wallet space, where the Delhi NCR-based Paytm is currently leading with over a whopping 160 million users.

Prior to this, Paytm was the only mobile wallet payment option available to Uber users to pay for their ride. But now, the users will also have an option of paying through Reliance Jio Infocomm's Jio Money.

As a part of the deal, Reliance Jio will be offering exclusive incentives for people who opt to use JioMoney, the mobile wallet app, for making Uber payments. Reliance is also planning to soon allow its users to book and pay for Uber rides from the Jio app itself, a feature that Paytm does not offer.

Paytm has been Uber's preferred payment partner for the longest time, but the deal is most likely to change the same.

The mobile wallet business has been the biggest gainer of the Indian government's surprise demonetisation move sprung on its citizens on the night of 8th October, 2016. The drive, which ended up sucking out 86% of the country's currency in circulation, resulted in a temporary cash crunch situation, which ultimately led to people turning to digital wallets to satiate their cash hunger.

While Reliance Jio might have ended up missing the bus during the demonetisation phase, but it is now in full form to aggressively pursue the Indian mobile payments space. The Jio-Uber partnership deal is a testimonial of just that. According to experts, a lot now depends on how Jio incentivises Uber users and cashes on the great opportunity that the deal presents.

Commenting on the partnership with Jio, Madhu Kannan, chief business officer, India and Emerging Markets for Uber said, “Digital payments have become part of our everyday lives and by integrating JioMoney as a payment option, our riders will have the ability to use a familiar and consistent payment experience."

According to a statement given by Anirban S Mukherjee, business head of JioMoney, “JioMoney’s integration with Uber will power the rapid migration of many more Uber transactions to the digital platform."

Launched last year, Reliance Jio claims to have added 72 million telephony subscribers till date. Though it hasn't yet given out the subscriber details of its JioMoney users, but it has time and again claimed that the mobile wallet will be playing a critical role in the company's growth.

The mobile payment space in India is heating up big time with several new players being added every month and the old ones rapidly strategising to build a larger user base. Currently, Paytm and MobiKwik- both of which already boost of having one million merchants- are planning to add more merchants so as to provide their respective users with as many options as available. We had also recently reported that Paytm is close to raising $180-200 million (around Rs1,210-1,350 crore) in an investment round led by Chinese internet giant Alibaba Group Holding Ltd. Other than Paytm and MobiKwik, Indian government-backed BHIM app, SBI Buddy, and Snapdeal’s FreeCharge are some of the other prominent players in the market.

[Image: TheQuint]

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