Paytm, Google, others see India's low rate of digital payments as an opportunity after the value of digital wallet transactions rose 64% from Dec. '16-Dec. '17
New York Times : Tweets: @stevelohr , @hitoishichakma , @vindugoel , @vindugoel , and @nytimestech Tweets: Steve Lohr / @stevelohr : Why India still clings to cash. Trust matters more than technology. http://www.nytimes.com/... @vindugoel @suhasiniraj Hitoishi Chakma / @hitoishichakma : Google's Tez, Alibaba's Paytm and now whatsapp payments! India looks set to be an interesting place to watch for the coming years! However how do we ensure that everybody has access to cheap and reliable data? http://www.nytimes.com/... Vindu Goel / @vindugoel : Paytm CEO @vijayshekhar has big goals for the Indian payments company. “Our truest ambition is for Paytm to be known as the bank for this new-age, digital, mobile world,” he says. He wants to reach 500 million Indians in the next 3 to 5 years. https://nyti.ms/2FbebMt Vindu Goel / @vindugoel : Indians have a love affair with cash. “Cash is convenient. It's anonymous. You can use it everywhere,” says a top Google exec. So how will Google, Facebook, Paytm and the government persuade Indians to switch to digital payments? https://nyti.ms/2FbebMt NYTimes Tech / @nytimestech : Not long ago, Chinese preferred to pay in cash. Today, mobile payments are everywhere. Will India follow the same path? http://www.nytimes.com/...
Context & Ripple Effects
This January 2018 piece catches the moment global platforms sized up India's cash-heavy economy: wallet transaction value rose 64% in a year, and Paytm set a goal of reaching 500 million Indians while positioning itself as a bank for the mobile world. Where that bet actually landed shows up in later coverage — on NPCI-run UPI rails, not proprietary wallets.
The competitive map shifted fast after this report: by 2022, Indian government data showed Walmart-backed PhonePe and Google Pay holding a combined 80%+ share of mobile payments, while WhatsApp languished at 0.02% despite planning cashback rewards to lure users.
First-order effects
- Paytm's bid to become a bank for 500 million Indians puts it in direct competition with Google's Tez and other wallet operators for the same newly digitizing users.
- For Google, the 64% growth rate confirms India as a market where payments adoption is arriving faster than incumbency, letting new entrants scale without displacing entrenched card or wallet networks.
Second-order effects
- Facebook's WhatsApp entry into Indian p2p payments forces incumbents into incentive spending — cashback and merchant subsidies — to defend share against a platform with pre-installed distribution.
- Merchant-side monetization becomes the next battleground, later visible in sound boxes turning payment confirmations into a lucrative revenue stream for Paytm and rival fintechs.
Third-order effects
- Government-backed open APIs (the India Stack) let any third party build payments, lending, and services on shared rails, structurally favoring distribution giants over wallet owners.
- If the pattern holds, India becomes the reference case for leapfrogging private card networks entirely through nonprofit-run interoperable settlement systems.
The trend: India's digital payments market is consolidating from proprietary wallets onto state-built open rails, where global platforms compete on distribution rather than payment infrastructure.