MUMBAI (NewsRise) -- Apple's plan to introduce its Apple Pay services in India is set to heat up the race to dominate the nation's booming mobile payments market that has already lured Google, Amazon and Facebook's WhatsApp.
India's mobile phone payments market is riding on the wave of surging internet usage as more people get online to buy books, mobile phones, accessories, and apparels. According to a Boston Consultancy Group report, the country's digital payments industry will be worth about $500 billion by 2020.
The growth of internet usage surged after billionaire Mukesh Ambani rolled out his wireless venture in September last year, offering virtually free services to initial subscribers and stirring a price war among telecom operators. Prices for high-speed internet data have crashed as carriers cut rates to compete with Ambani's Reliance Jio Infocomm.
An annual Internet trends report, published by Kleiner Perkins partner Mary Meeker, earlier this year showed data prices in India dipped more than 48% between November last year and March, following the entry of Reliance Jio. The plunge in prices resulted in a more than 20-fold jump in online transaction values, according to the report.
In an interview to Mint newspaper published on Monday, Apple's Senior Vice-President Eddy Cue said the company wants to launch Apple Pay in India in the near future, though he didn't give any specific date.
"India is one of those markets where we hope to bring Apple Pay to," he said, according to the report. The iPhone maker plans to partner or integrate its payments service with established players in the country such as Paytm, rather than build a new payments solution from scratch, Cue was quoted as saying.
Apple Pay allows users to transfer money and make purchases in store and online. The company currently offers the services in North America, Europe, Australia, New Zealand, and select Asian markets.
An Apple spokesman declined to comment.
India's digital payments market is dominated by the mobile wallet services offered Paytm, backed by China's Alibaba Group Holding. Paytm accounts for more than half of India's mobile wallets user base.
That hasn't choked the ambitions of global players such as Google and Amazon. Last month, Google launched an India-specific mobile payments service called Tez, predicting 650 million Indians will be online in the next two years.
According to Google, 70 million people shop online in India, a number that is likely to reach 150 million by 2020.
Earlier this year, Amazon said it won a license from India's central bank to launch a digital wallet, while WhatsApp placed an advertisement on its website seeking a digital transactions lead for India, who has to be familiar with the working of the government's Unified Payments Interface.
The proposed entry of Apple's payments business comes as the company struggles to make deep inroads into India's smartphone market dominated by Chinese players. Apple has been trying to warm up to the Indian customers, launching a manufacturing base in the country to assemble its lower-priced iPhones. More than a year ago, it also launched Apple Music in the country.
--Dhanya Ann Thoppil