How does Google Pay earns money?

Did you know How does Google Pay earn money?

How does Google Pay earns money?
UPI Apps and online wallets are required for quick and straightforward transactions. Only UPI Apps or Online Wallets like Google Pay allow us to do transactions without cash or cards from the comfort of our own homes, wherever we are. One of the most popular apps is Google Pay.

These Apps enable contactless transactions on mobile devices in-app, online, and in-person, with Google Pay or G-pay assisting all of these services. In addition, one may send payments to other Google Pay users, service providers, and company owners and make bill payments to third parties, using any Payment Instruments recognized by Google Play.

Google Pay is now accessible in around 28 countries.

So, while Google Pay gives us a platform to perform contactless transactions and makes our lives easier, the issue remains as to how they generate money. We all know that the Google Search engine makes money through Google Ads, but how does G-pay generate money?

The Google Pay app is free to install and use, and it does not charge users any money for transactions or collect any commissions or other fees.

It might be a lucrative source of cash for Google. However, for the time being, Google Pay's principal role is to expand its user base. In addition, because it is a Google subsidiary, it already has a vast footprint and has made cashless transactions relatively simple.

When Google launched its wallet system in India, the notion of UPI (unified payments interface) was already in place. However, since Google Pay became available, it has surged. Of course, Google Pay was responsible for many of these benefits.

What is Google's revenue model?

Google Pay derives money via commissions, which it receives for service provider transactions and bill payments. As a result, the App earns a tiny portion of each transaction made using Google Pay.

G-pay makes money from three different sources:

Bill Payments: The App allows users to pay various bills, including water, electricity, insurance, loan payback, and DTH recharge. G-Pay receives a commission from the service provider for each payment made using the App.

User base Via UPI Transaction: Customer base Google Pay is aided by a UPI-based digital payment software that allows users to send money to any other GPay customer using their registered phone number. Google Pay does not profit from this type of transaction, but it does provide the corporation access to customer data that they may use to improve their product.

Fee on mobile recharges: The firm receives a commission every time a user pays and does their recharge using the Google Pay App.

According to a Techcircle report, Google Pay controls more than 40 percent of the UPI market. Revenues for 2019-2020 were Rs 1,501 crore, increasing 34.26 percent from Rs 1,118 crore the previous year. According to the company's recent regulatory filings, net earnings for 2018-2019 were Rs 32.87 crore, up 544 percent from Rs 5.10 crore."

According to statistics collected by TechCircle from the National Payments Corporation of India (NPCI), Google Pay expected 960 million transactions in November 2020, up from 857.8 million in October 2020. PhonePe, a competitor, had 868.4 million transactions in November 2020, accounting for 39 percent of the market.

It's a broker app that connects the user to a third-party application. Over time, it creates income by using the monopoly to leverage customers and vendors. In the data-driven market, it has a very high valuation.

The Google-managed UPI network estimated 75 million transactional users in India in May 2020.

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