PhonePe worked overnight together with the National Payments Corporation of India(NPCI) and ICICI bank to resume service within a day.
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PhonePe has a huge customer base worldwide nearly 218 Million and out of which 100 Million only in India. PhonePe was solely using Yes Bank service for their UPI transactions. This came to a halt amid YES bank’s debacle. The fintech industry witnessed a slow recovery by restoring all merchant settlements like debit/credit card transactions by Friday noon. All UPI services were restored by Friday night with the users continuing the same [email protected] handles.
How PhonePE Fought the Crisis
PhonePe officials had already smelled the rat and completed the groundwork. They were ready with the backup plan. the dedicated staff of PhonePe worked for straight 34 hours to execute it. The transactions summed up to 4000 crores in a mere 24 hours. And the platform sets a record of huge user traffic in a single day with 70 Million App sessions.
Recalling the unsettling phase that PhonePe underwent in past days, the Founder and CEO of PhonePe said,
“Friday was an extraordinarily difficult situation with little precedence. We are grateful to the RBI, NPCI, Yes Bank and ICICI for working collectively to ensure that millions of our customers and merchants were not inconvenienced a minute longer than necessary”.
Answering to the twitter user when they asked about the redundancies in the company, the CEO stated that they do exist. “Just never imagined the bank itself going totally dark like this. Lesson learned in the hardest possible way,” he added.
On a mailed query sent to PhonePe, PhonePe replied that they are actively working on adding other PSP partners. And when questioned about the delay as many players like Paytm and Google Pay have already adopted, PhonePe responded as.
“ No one anticipated the moratorium and there is little we could have done to speed this up any further.”
PhonePe Not the One Affected
Yes bank was one of the leading banks in handling UPI since its inception and also has been ranked on the top for the same and ranked second in terms of overall Payment volumes across the UPI ecosystem in FY 2018-19.
Yes bank is the sole service partner for most of the third party payment merchants. In addition, 14 out of 31 merchants have opted for Yes bank as their banking partner. Out of which PhonePe and Bharat Pe had partnered with Yes Bank alone. As a result, RBI imposed restrictions on Yes Bank affected both.
Several other start-ups like Udaan, Neo-bank, Cashfree, MakeMyTrip, Myntra, Ezetap and Swiggy who partnered with Yes Bank, have said to be partially affected.
Online Gateways That Jumped Into Acton Instantly
Post the RBI moratorium to Yes Bank many players in the market blocked the payments that had been processed through the Yes Bank platform.
“Post the RBI moratorium on withdrawal of money from Yes Bank, Paytm Payments Bank has taken this step to ensure that its users’ money doesn’t get stuck in their Yes Bank accounts where they are unable to move their money out,” the payments bank said in a statement.
Similarly, financial technology firm Instamojo and payment gateway firm Razorpay though remains unaffected from the ongoing crisis, withheld the payments through Yes Bank to safeguard customers’ funds from getting blocked.
Worried with the critical phase underway, the Chairman of the Payment Council of India, Vishwas Patel desired a better-planned way to place the moratorium.
“The chaotic and sudden way in which RBI placed the curbs has put the entire system at risk not only creating reputational concerns but also a scenario where merchant networks may pull back services it already offered to customers due to non payment of dues” he added.
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