Amidst falling market share, BHIM begins offering discounts for third party apps

After facing the heat from the early and late entrant in UPI ecosystem in terms of volume, traction and utility, BHIM has been fighting a nominal war against private players including PhonePe, Google Pay and Paytm.

The trio dominates the UPI payments railroad with a collective market share of 90%, leaving a narrow space for other apps running on UPI such as BHIM, Freecharge, Mobikwik and Amazon Pay.

For instance, BHIM contributed a mere 1.8% in overall transaction happened over UPI in September. 

The onslaught of one of the top three players has been hurting BHIM for a long time. Sensing the opportunity by enticing consumers through offers, BHIM has partnered with several companies across segments such as e-commerce, travel, gifting, retail, dining and online pharmacy among others.

According to the latest version (BHIM 1.7) of the app, it is providing offers for consumers transaction on merchant apps such as OYO, Railyatri, Zoomcar, ShopClues, Housejoy, Pepperfry, Faasos, Box8 others. The nature of reward and offering also vary from platform to platform.

Entrackr has tried to get and redeem offers available on BHIM by transacting on the companies mentioned above. It is working perfectly.

For BHIM, which was out of action in terms of rewards and incentives, this move will take it closer to PhonePe, Google Pay and Paytm. They have been profusely burning money to lure customers through discounts, offers and rewards.

It looks like BHIM is preparing for NPCI’s latest crackdown of limiting market share for a single entity to 33%. The newest inclusion by BHIM may help it becomes a sticky app for existing as well as the new consumer base.

While PhonePe and Google Pay thriving on UPI for the past six months, the Alibaba-backed company has shifted its strategy. Tactically, this would be the best time for BHIM to regain the momentum it lost after initial gung ho.

In the latest version, the transaction limit for BHIM customers has been increased to Rs 40,000 per transaction and per day for one bank account given that the bank’s transaction limit may vary.

Focusing on the vernacular audience, BHIM has also added three more languages - Konkani, Bhojpuri and Haryanvi - making it available in 16 languages in India.

Last year, BHIM was criticised for offering cashback offers only to BHIM app users. Later on, the government had withdrawn incentive scheme. It would be interesting to see how BHIM survives in front of incumbents through a fare play around discount and offers for third-party apps.