Device Deployment Hits 1 Million For Two Straight Quarters: How Paytm Soundbox Is Fuelling Growth
Paytm Soundbox offers merchants instant audio confirmation of payments made through Paytm QR code
*This is in partnership with BQ Prime BrandStudio
India’s payment revolution is showing no signs of slowing down, as both merchants and consumers continue to embrace digital payment technology with enthusiasm. Paytm Soundbox, Paytm’s pioneering IoT device launched to address a specific need amongst merchants, has witnessed tremendous adoption since its launch, according to Paytm. This battery-operated device offers a range of features that have made it one of the most preferred choices for merchants in the country to accept payments, including Paytm’s All-In-One QR, 4G support, cashback, and seven-day battery life.
According to Paytm’s Operating Performance Update for quarter ended December 2022, Paytm has further strengthened its leadership in offline payments with a cumulative deployment of 5.8 million devices including PoS and Soundbox. This represents an increase of 1 million merchants paying subscriptions for payment devices in the quarter and marks the second consecutive quarter in which Paytm has achieved device deployment of 1 million. In a year, the company has gone from 2 million devices to 5.8 million devices, according to Paytm.
Paytm’s focus on subscription services continues to expand as the company focuses on creating additional payment monetisation beyond merchant discount rate (MDR). With its subscription-as-a-service model, the strong adoption of devices drives higher payment volumes and subscription revenues, while increasing the funnel for its high-margin merchant loan distribution business. The robust adoption of subscription products by merchants is making payments increasingly monetisable and profitable for Paytm.
Paytm Soundbox offers merchants instant audio confirmation in any of the 11 supported languages for every payment made through a Paytm QR code. This helps build trust between merchants and customers, as merchants can quickly confirm successful payments. It supports multiple payment methods such as Paytm Wallet, Paytm Postpaid, Paytm UPI and other UPI apps, net banking, and cards, thereby providing more flexibility and convenience to merchants. By leveraging insights into merchants’ payment flow, Paytm is able to offer them the ability to seamlessly obtain loans from its financial institution partners. This capability makes it more attractive for merchants to use its platform for all their payment and financial services needs.
According to Paytm’s earnings presentation for quarter ended September 2022, merchants who also have Paytm devices accounted for over 85 percent of merchant loan disbursals. Paytm’s lending partners are able to rely on its distribution and merchant insights, otherwise unavailable to them. Merchants are increasingly willing to pay for technology that enhances the trustworthiness of digital payments. This presents Paytm with a great opportunity to enable financial inclusion for a large number of merchants. This journey means that the relationship the company has with its merchants expands over time from QR payments to devices to credit.
The penetration level for merchant loans remains low at just 4.4 percent of total devices deployed (as per the earnings presentation for quarter ended September 2022), suggesting that there is significant headroom for growth in this area. According to Paytm, as the company continues to add more devices, the total market for merchant loans will continue to expand, providing opportunities for further growth.