Wednesday 31 July 2019

Amazon crosses 5-lakh seller base in India: Official

Amazon will pay freight charges equivalent to the highest lease rate on the same train on pro-rata basis.
Amazon will pay freight charges equivalent to the highest lease rate on the same train on pro-rata basis.
Chandigarh: E-commerce major Amazon on Monday said its seller base has crossed the five lakh mark in the country boosted by various India-first innovations and traders from small cities and towns. The e-tailer has crossed the mark in its more than five years of operations in the country, an official said. 

"The seller base has crossed the five-lakh mark," Amazon India Vice President (Seller Services) Gopal Pillai said, while attributing 

the rise in seller base to various India-first innovations, which encouraged sellers' participation, especially from tier-II, and -III. 

He was speaking on the sidelines of an event to launch products by Ludhiana-based Trident Limited on Amazon's global marketplace as a part of Amazon's Global Selling Programme (AGSP). 

"We hope it inspires thousands of other manufacturers and brand owners across Punjab to come and take advantage of this platform," he said. 

Amazon is providing transparent and level playing field to all the producers and giving them opportunity to showcase their products across the globe, Trident Group Chairman Rajinder Gupta said. 

"More than 80 per cent of the global sellers are coming from tier-II and -III cities, particularly from manufacturing zones like Surat, Ludhiana and Lucknow. We are also seeing lot of B2B manufacturers coming into B2C and succeeding," Pillai said. 

Punjab Education Minister Vijay Inder Singla said the state's famous Phulkari and handicraft items should also be marketed on e-commerce portals. 

He said that e-commerce portals are lucrative platforms for Indian sellers to engage with global audiences. 

"They have huge sales potential and entail minimal marketing cost. In order to promote the sales of local handicrafts, they should also be showcased on such platforms," he said. 

The minister said he will raise the issue with the chief minister. "This would promote exports and help the small-scale industry in Punjab to grow," he said. 

Pillai said through AGSP, Indian exporters can showcase their product range "on our 12 international marketplaces, and can also embark on a successful and profitable e-commerce journey that adds global scale to their businesses and expands market reach." 

"Through this programme, we want to bring more and more Indian brands and MSMEs on board to unleash the potential of 'Make in India' initiative, by enabling e-commerce exports and providing global customer access," he said. 

Clocking USD 1 billion dollar in cumulative exports till now, AGSP is expected to generate USD 5 billion in cumulative export sales by 2023 for Indian exporters enrolled in this programme, he said.

Railways parcel business to get boost, Amazon roped in to transport goods

Railways parcel business to get boost, Amazon roped in to transport goodsNEW DELHI: The railways parcelbusiness is all set to get a boost with the national transporter roping in e-retail giant Amazon to transport its goods by train.

According to a Railway Board letter issued earlier this month, as a pilot project the railways will give Amazon space in two of its premium trains - the Sealdah Rajdhani and the Mumbai Rajdhani for a period of one month, which could be extended to three months depending on the feedback received.

According to the agreement, zonal railways will earmark a space of 2.5 tonnes in the parcel van of the trains for loading/unloading of Amazon India consignments and the remaining space of 1.5 tonnes will be for railways.

Amazon will, however, pay freight charges equivalent to the highest lease rate on the same train on pro-rata basis.

One month advance freight charge will be levied on the e- commerce company by the railways.

However, the news of Amazon India being given the task of loading and unloading parcels has irked workers unions, with the Bhadatiya Railway loading, unloading workers union, alleging that it would cost them their livelihood.

The union has called for a two-day strike on July 31 and August 1.

Muted growth for online commerce: Net, net, India's net use slowing

Muted growth for online commerce: Net, net, India's net use slowingNEW DELHI: India’s internet story is losing some of its lustre, with implications for internet commerce companies.

Growth in internet user base is slated to come down for the second consecutive financial year — 2018-19 growth rate will be even less than the 8% witnessed in 2017-18, which was a sharp drop from 2016-17’s 12%.

The final figure will be released by the Internet and Mobile Association of India (IAMAI) in mid-August. ET spoke to people familiar with the ongoing exercise. “I suspect new internet user growth will decelerate even further and will reach a plateau in the next four to five years,” said Subho Ray, president, IAMAI.

Muted growth for online commerce: Net, net, India's net use slowing 
Moreover, the proportion of internet users engaging in digital commerce is also not moving upwards. For example, only around 120 million people are using digital payments out of a user base of around 500 million internet users, as per IAMAI.

By 2020, according to a Google-AT Kearney report, only 175 million Indians are expected to engage in online shopping. IAMAI’s Ray, however, puts the number of active online shoppers at just around 50 million.

More than half of India’s population is not online and growth in new users and digital commerce should be brisk. But experts say slowing growth in user base is happening on account of a number of factors.

First, for many millions going online is still an expensive proposition.

‘Need to Educate Users’
And feature phones to smartphone conversion in these segments is very low.

Second, most new users are vernacular language proficient and they find English language-dominated internet both complex and lacking in vernacular content. Datafrom Nielsen shows average time spent online in India is more than 90 minutes a day. And watching videos is the most popular activity.

A Google India spokesperson said, “Every new user coming online is an Indian language user and has very limited understanding of what internet can do for them…we also need products that serve the needs of these users.”

Anand Kumar Bajaj, CEO, PayNearby said, “What we are seeing is wasteful consumption. People wasting their time watching videos. There’s a need to educate users on what they can do with mobile internet.”

He also argued that even among transacting users, the magnet is cashbacks. Once cashbacks go, at least some users are likely to go back to free videos.

Others also see data usage coming down. Chris Lane, managing director, Asia-Pacific Telecommunications at research firm Bernstein told ET recently, “As India already has one of the highest data consumption rates (for 4G users), the pace of growth going forward is likely to slow.”

QR Codes Help Payments Firms Up Offline Play

QR Codes Help Payments Firms Up Offline PlayPratik.Bhakta 

Bengaluru: Digital payments companies are increasingly looking at offline payments and trying to capture a larger share of this market by means of QR (Quick Response) codes. 

While Paytm, PhonePe and Google Pay offer QR codes and acquire their own merchants as well, entities like BharatPe act as aggregators, onboarding merchants for all forms of Unified Payments Interface (UPI)-based payments.

Out of the transactions seen on the BharatPe platform, PhonePe had over 54% share in UPI transactions, while Google Pay had 30% and Paytm 12% in June.

On QR codes deployed by BharatPe, the share of PhonePe has increased steadily from 44% in January, a jump of 10 percentage points. Paytm may have a smaller share, but the company dominates the overall QR code-based transactions, since it has a chunk of offline payments through a proprietary QR code base of its own. Paytm recorded around 250 million transactions on Paytm QR through 12 million merchants, it said. Paytm QR accepts UPI payments made from any bank account through the Paytm app.

"We launched our innovative Paytm QR in 2015 and millions of people adopted it across the country, from the local kirana stores, autorickshaws and fast-food joints to top-end hotels and restaurants," said Deepak Abbot, senior vice president at Paytm. "We have witnessed three times growth in the last one year, including both online and offline payments."

PhonePe, on the other hand, did not comment on the exact number of transactions taking place through its QR codes, but said, it has 5.5 million offline merchants overall who exclusively accept UPI payments through PhonePe.

There is increased adoption of UPI payments through BharatPe, with 10 million transactions reported in June compared to 6 million in April, said Ashneer Grover, chief executive officer at BharatPe. "We are seeing average transaction value on our platform hovering around Rs 250, which I believe is a healthy sign," he said.

The National Payments Corporation of India does not share details of transactions happening on BharatQR, the bank-led QR code programme that has all the payment railroads such as Visa, Mastercard, RuPay and American Express. NPCI has onboarded 28 banks to acquire merchants for such transactions.

Offline payments have emerged as a major area of debate as the government has proposed zero charges on all forms of digital payments to encourage adoption.

While a section of payment companies have raised concerns, most smartphone-based payment players have supported it. "Removal of MDR is a welcome step, no more tolling in the name of payments, everyone has to play a simple credit game now," said Grover.

Tuesday 30 July 2019

E-market Udaan plans new round at $2.7 billion valuation

E-market Udaan plans new round at $2.7 billion valuationBENGALURU: Udaan, an online marketplace that supplies products and gives loans to small merchants, is in talks to raise a new round of funding of around $500 million. 

This will be at a post-money valuation of close to $2.7 billion, as business-to-business (B2B) startups continue to be high on investors’ radar. The three-year-old entity had become the fastest startup in the country to reach unicorn status last year.

Udaan is in talks with existing backers DST Global and Lightspeed Venture Partners — besides new investors, including hedge funds like US-based Altimeter Capital and China’s Hillhouse Capital — to invest in the latest round, said two sources briefed on the matter. “The capital is being raised to build out the supply chain network for the company besides scaling up the NBFC business,” said one of the sources. 

Udaan is looking to scale up its expansion in the market where players like US retail giants Walmart and Amazon, Chinese e-commerce major Alibaba and homegrown giant Reliance Industries are also expected to make an aggressive push. 

E-market Udaan plans new round at $2.7 billion valuation

The funding round is expected to be finalised in the coming months. Since inception, Udaan has raised three rounds, taking total capital raised to $285 million. While Lightspeed and DST Global are existing backers, Altimeter Capital has backed companies like Practo and Pine Labs in India, while Hillhouse has backed Swiggy, CarDekho and Paper Boat. 

Emailed queries sent to Lightspeed, DST Global, Hillhouse and Altimeter did not elicit a response till the time of going to press. Udaan co-founder Sujeet Kumar declined to comment. 

The company has been doing annualised gross sales of over $2 billion across categories — from fruits & vegetables, smartphones, fast moving consumer goods (FMCG), fashion & apparel, staples to electronics — said the sources. Udaan is also investing heavily to build out its network, losing over $10 million a month. 

The startup was founded in June 2016 by three former top Flipkart executives — Vaibhav Gupta, Amod Malviya and Sujeet Kumar. While Gupta was SVP of business finance and analytics at Flipkart, Malviya was chief technology officer. Kumar was one of the earliest employees responsible for building logistics unit Ekart and was also looking after WS Retail, the main seller on Flipkart. 

Udaan started out by building a marketplace for merchants to buy and sell goods from distributors and manufacturers. It has a network of 2 million retailers or kiranas across 900 cities and towns in the country and has over 25,000 sellers on the platform, including small manufacturers, wholesalers and companies like Reckitt Benckiser, Marico and Motorola. Besides offering supply chain solutions, it has also started disbursing loans in the range of Rs 10,000 to Rs 2 lakh to about 1 lakh buyers on the platform after setting up an NBFC last year. 

Overall, the B2B commerce space has been attracting money in the last few months as Tiger Global Management led a $90-million round in vegetables supply chain player NinjaCart. Tiger Global, along with Sequoia, also backed industrial goods marketplace Moglix with a $60-million round.

The interest in the space is being driven by investors’ belief that companies can build more profitable models. Last month, one of the country’s oldest B2B classifieds and commerce platform IndiaMart also went public in a Rs 475-crore IPO with share prices shooting up 50% on its listing day.

Paytm Money to get Rs 250 crore, eyes low-cost broking business

Paytm Money to get Rs 250 crore, eyes low-cost broking businessOne97 Communications-promoted Paytm Money will put an additional Rs 250 crore in its investment platform in 12-18 months. 

This will be on top of a Rs 80-crore investment made by the promoter in the first year of business. After building a retail base of nearly one million active users through its direct mutual fund distribution platform, the company plans to disrupt the low-cost broking model. It has already received approvals for providing stockbroking and depository services.

What sets Paytm Money apart from other distributors is that it is registered as an investment adviser with Sebi and does not receive any commission and investors can choose to put money in any of the direct schemes of all 40 mutual funds in the country. Since the entire process of on-boarding the customer to investment and redemption is done through a mobile app without human intervention, the company can enable systematic investment plans (SIPs) for as low as Rs 100.

Speaking to TOI, Paytm Money director Pravin Jadhav said that within a year of launch, the firm has become the largest platform for direct SIP investment plans. “Of the total number of SIP registrations in the country, 40% of accounts go through Paytm Money. We are expanding the market as 80% of our users are first-time investors in the capital markets and come from beyond the top 30 cities in the country,” said Jadhav. 

According to Jadhav, enabling the micro-SIPs will expand the mutual fund investor market to 50 million in four-five years from 19 million at present. “Our focus is on the simplicity of investing for common people. Instead of complex features, we plan to have in the app short videos of fund managers, which will help the investors understand the scheme,” he said.

The company has been able to create a straight-through platform by incorporating UPI for drawing payments from bank accounts and has now introduced net banking-based electronic mandates for SIP plans. Investors can view the performance of every scheme and compare it with others. “Of the total investors in mutual funds, 20% have chosen to park money in instant redemption schemes. Of the rest, 60% of investors have chosen equity, while another 25% have gone for tax-saving schemes, and remaining in debt schemes,” said Jadhav.

Flipkart CEO sees UP becoming India's first trillion-dollar state economy

Flipkart CEO sees UP becoming India's first trillion-dollar state economyLUCKNOW: Projects that formed part of the second Ground Breaking Ceremony will help in Uttar Pradesh's quest to be first trillion-dollar state economy in India, FlipkartGroup Chief Executive Officer Kalyan Krishnamurthy said here Sunday. 

"The groundbreaking ceremony will play a key role in propelling Uttar Pradesh as an industrial and innovation hub in the country and help in the state's quest to be India's first trillion-dollar state economy," he said on the sidelines of the event for groundbreaking of industrial projects worth around Rs 65,000 crore, for which memoranda of understanding were signed during the UP Investors' Summit last year. 

Krishnamurthy also said Chief Minister Yogi Adityanath's "vision and enabling initiatives will boost investor confidence in the state" as ease of doing business is expected to improve. 

"UP is an important state for us at Flipkart. We not only have many sellers and local MSME (micro, small and medium enterprise) manufacturers who are accessing the nationwide market to sell their products more efficiently and in a cost effective way, but we are also encouraging local handicrafts to market their products. 

"Thousands of artisans, small businesses and women entrepreneurs are finding partnership with Flipkart beneficial as they grow and connect with a pan-India market," he said. 

Using homegrown technology and innovation, Flipkart is proud of making a difference in the lives of millions of people, he said, adding that through Myntra, a fashion platform, "we are excited to give market access to artisans/weavers across the state". 

Krishnamurthy lauded the chief minister's efforts to partner with the industry to drive inclusive growth in the state. 

"We are looking forward to partner with UP as we bring in the next 200-300 million customers to experience e-commerce and connect lakhs of MSME suppliers, small farmers and farmer-producer organisations to the marketplace while creating lakhs of new livelihood opportunities," the Flipkart Group CEO added. 

Flipkart, which was acquired by the US retail firm Walmart last year, is equally keen on promoting MSMEs and one-district-one-product (ODOP) in Uttar Pradesh, its Chief Corporate Affairs Officer Rajneesh Kumar told . 

The ODOP project is one of the key initiatives of the Adityanath government which seeks to promote traditional industries synonymous with their respective districts to spur the local economy and create jobs, Kumar said. 

There are specific products in Uttar Pradesh that are found nowhere else, such as ancient and nutritious 'Kala namak' rice, the rare and intriguing wheat-stalk craft, world-famous chikankari, zari-zardozi work on clothes, and also the exquisite Banarasi silk work. 

The state government during the investor meet in February 2018 had signed 1,047 initial agreements entailing proposed investment of Rs 4.68 lakh crore by private and public sector companies. 

The state in July last year organised the first ground-breaking ceremony to mark the launch of industrial proposals worth Rs 60,000 crore.

Government plans e-commerce boost for 200 rural products

Government plans e-commerce boost for 200 rural productsNew Delhi: Rural artisans may soon be able to sell their products through e-commerce platforms as part of a facilitation plan envisaged by the government that includes setting up of producer companies in select clusters.

The rural development ministry has drawn up a list of 200 products that will be sold on e-commerce platforms, including the Government e-Marketplace (GeM), said officials. The ministry has joined hands with Tata Trusts to set up a not-for-profit company under Section 25 of Companies Act to provide professional support to rural artisans to sell their products globally, they said.

“We are in the process of setting up clusters or producer companies by bringing in people making similar products,” a senior government official told ET.

Some handicrafts and handloom products, such as Madhubani paintings from Bihar, tribal paintings from Jharkhand, terracotta items from Rajasthan and tussar silk wear from Bhagalpur, made by rural artisans, mainly women entrepreneurs, are already being sold online via Amazon and Flipkart.

The govt is now keen to expand the initiative as part of the 100-day plan in the second term of the Narendra Modi government. The products identified by the government could include stationery items such as folders, pen holders and gift items, according to those in the know.

Government plans e-commerce boost for 200 rural products 
The official cited earlier said the government’s initiative will help rural artisans legally qualify to be on e-commerce platforms and cater to a larger market.

A dedicated value chain development centre, with four-five regional offices, is being set up by the government to provide complete value chain solutions to rural artisans. This will provide artisans technical assistance as well as help in designing and packaging of products to enhance their global appeal.

The plan includes engaging professional photographers and content writers to ensure products featured on e-commerce platforms have a story to tell to make them more attractive to buyers.

“Coming on to the e-commerce platform will help artisans get larger volumes and better prices for their products even after parting with at least 40% (of revenue) to these sites as seller charges,” said G Vinod Nair, manager-non-farm livelihood products, National Rural Livelihood Mission.

At present, rural artisans sell their products through central and state exhibitions organised by the ministry or directly through traders, besides catering to local demand restricted to their own districts.