Instant messaging app Hike, the messenger unicorn from India, had a flashy countdown clock running on its website on Tuesday. It said if you can’t wait to find out, download the app. We downloaded it but nothing changed. After the countdown, we installed the app again. Again, nothing happened…
…Meanwhile, in Delhi, the clock gave way to the show: “We are going to bring some much-needed love for payments in this country, said Kavin Bharti Mittal, the chief executive of Hike. “So I’m very excited to announce that we are introducing,” he said with a small pause for effect, “the Hike Wallet.”
It didn’t stop there. He also said Hike, as part of redesigning the app with a host of new features, will launch payments using Unified Payments Interface (UPI). It will be supported by Yes Bank. Mittal said one can use Hike to send money using UPI even to non-Hike users. So, in effect, that makes it a UPI app, putting it in the league of government-run UPI app BHIM. It alone accounted for 42% of UPI transactions in May, with PhonePe having the second largest with 38%.
But Mittal says, its 100 million user base, will make Hike the largest UPI platform. Overnight.
That’s only partially true. Truecaller, the contact ID service, that launched UPI along with ICICI Bank in March, also claims 100 million users. But a senior banking executive from a rival bank who is privy to the data, says less than 1% of transactions happened via Truecaller.
It’s not surprising why few people used apps like Truecaller to make UPI transactions. It is an app that helps find out a caller’s identity. So why would anyone use it for payments when there are many other apps around to pay peers and small businesses?
Well, a similar question can be asked of Hike as well.
Mittal said in media interviews that the company has been looking at payments for the last two years. But if it indeed wanted to make payments the big draw to bring more users to its app, it is late to the game that is getting intense by the day.
Ritesh Pai, digital banking head of Yes Bank, said that the bank issued a semi-closed wallet license to Hike based on the use case it wanted to build on top of the app. That is to enable mobile recharges, hailing a cab or ordering food from within the app. In other words, do what WeChat did in China. And Facebook is attempting in the United States.
But wallet companies like Paytm and MobiKwik have captured the digitally-savvy natives with cashbacks and made it a habit among those who use wallets. Hike, however, sees a different use case for its wallets.
Mittal believes its features like ‘blue packets’, through which Hike users ( who are mostly under the age of 24) can send money to each other’s wallets in quirky envelopes with fun messages.