Reliance Jio in India has single-handedly changed the course of how Indians consume Internet over a period of a couple of years and looks to hit the lucrative FinTech sector now with Point of sales (PoS) devices.
The Ambani’s Jio is reportedly getting into the PoS devices space and has already launched pilots with merchants in some cities such as Delhi, Mumbai, Pune, Bengaluru & Chennai.
For operating Jio’s PoS devices, merchants have to deposit $42.58 (Rs.3000) for the device and for all debit & credit transactions up to $28.39 (Rs.2000) in value, the merchant discount rate (MDR) would be zero. MDR is the cost paid by the merchant to a bank everytime a debit/credit transaction takes place at their stores.
For its PoS devices, Jio is partnering with Hindustan Unilever for acquiring a huge chunk of merchants. Given that Jio chose to partner with Hindustan Unilever, it shows how Reliance is seeking to dive as deep as possible in the FinTech sector with the PoS device entry.
Jio, after rolling out the PoS devices is now in the league with other Indian companies & startups like PayTM, PayUMoney, PaySwiff (earlier Paynear) and PhonePe.
Gurugram-based PayUMoney launched its PoS business with zero monthly rental fee and no minimum balance criteria & also gave an option to link any bank account. PaySwiff (earlier Paynear) has also introduced a PoS terminal.
Flipkart’s digital payments subsidiary, PhonePe recently acquired Zopper retail, a hyperlocal PoS platform for small & medium businesses.
With all these startups stepping in, they will be going head on with veterans and traditional merchant acquirers like HDFC Bank, Axis Bank, ICICI Bank and State Bank of India.
According to Inc42, Indian digital POS terminal startups have raised a total of $406 million in funding as of now. Some of the major POS terminal providers being Ezetap, Mswipe, Pine Labs, Innoviti, Mosambee, and PaySwiff.
Pine Labs has so far raised the highest amount of $227 million with $125 million being raised this year.
According to Global Market Insights, India’s market for PoS terminals is expected to cross $3 billion in the next five years, caused by an increase in the number of digital transactions post demonetization and the resulting growth in the digital infrastructure.