Razorpay doubles down on merchant onboarding, omni-channel presence

The fintech plans to expand its POS market share, besides expanding international payments solutions across Southeast Asia

By Salil Panchal Forbes India Staff

Published: Aug 30, 2024 12:35:13 PM IST

Updated: Aug 30, 2024 12:42:33 PM IST

Full Bio

Harshil Mathur, cofounders of Razorpay. Image: Nishant Ratnakar for Forbes India

Fintech unicorn Razorpay is fast gaining strength in areas beyond its core online payments business. The company, which launched India’s first biometric authentication with Mastercard at the Global Fintech Fest 2024, is building on its omni-channel strategy with increased offline presence and has doubled down on onboarding new merchants this year to process online payments, its CEO and co-founder Harshil Mathur told Forbes India, on the sidelines of the GFF 2024.

Alongside, it is continuing with its plan for a sustained international expansion in Southeast Asia, with the Singapore business set to kick off within the current fiscal year. Razorpay is backed by investors such as Tiger Global, Peak XV Partners, Y Combinator and Lone Pine Capital.

“In the coming year, our focus is on continuing to strengthen our POS [point of sale] presence. We were always strong online and now we are expanding offline, bringing to customers an omni-channel experience,” Mathur says. Razopay has a POS presence through more than 5 lakh stores, commanding a 3 percent market share in the POS device category. “We want this to grow to 12 percent over the next two years.”

Mathur says 75 percent of Razorpay’s business is online payments, the balance being POS, RazorpayX and international operations. The company offers 100 instruments to its customers on its fintech platform, including payment solutions for software-as-a-service (Saas) companies, small businesses and financial products.

New product launches

Razorpay this week launched India’s first biometric authentication, in partnership with Mastercard. This OTP-less system, powered by advanced passkey protocols, eliminates the need for memory-dependent authentication. “With a 4 percent boost in transaction success rates and a 35 percent reduction in OTP-related errors, this innovation allows customers to complete transactions effortlessly, benefiting merchants with higher conversion rates,” he says. It also launched DigiPOS, an application, which brings all Apple-related product prices, model features, EMI/ offers and payments onto one platform.

Razorpay is going live with its push provisioning feature, which allows cardholders to save their card details with multiple merchants on one platform, immediately after activating their card on their bank’s mobile app. This becomes particularly useful for customers who have acquired a new card or are making purchases from a new merchant. It reduces drop-offs, increases conversion rates for banks and boosts card spends.

In 2024, Razorpay has doubled down on onboarding new merchants to process online payments, after the Reserve Bank of India (RBI) lifted the ban on payment aggregators like Razorpay, Cashfree Payments and PayU. “We have onboarded more than 1 lakh merchants in early 2024, indicating pent-up demand within the ecosystem,” Mathur says.

Also read: How Razorpay is making online payments a breeze

Moving ahead

RazorpayX has also been a sustained focus point for Mathur, providing business banking, payroll, tax payments and escrow management services solutions for SMEs and mid-sized businesses. He says Razorpay’s Payment Gateway 3.0 (the latest payment solutions with upgraded technology) has also been a success. “We see a 7 percent conversion lift when they use PG 3.0,” Mathur says.

While Razorpay has, in 2023, expanded its payment gateway business to Malaysia by acquiring a licence there, it plans to launch its Singapore operations by FY25, followed by Thailand, Indonesia and Philippines. He declined to offer a timeline for other Southeast Asian countries, as it would depend on when they get a licence for operating there. “Real-time payments are increasing in these markets, so opportunities are there. As India’s UPI is going global, this is the opportunity for us to go global with it,” he says.

Mathur expresses confidence in the fact that the RBI has been pro-active in strengthening governance and regulatory norms for fintechs too. “We are all happy with growth, but it comes with a lot of risk, where cyber-crime and frauds need to be controlled. Policy makers have two strong objectives, innovation but drawing the boundaries, so that systems are not misused.”