InvestorQ : How is the deal between Phone Pe and ICICI Bank significant?
sarah Leo made post

How is the deal between Phone Pe and ICICI Bank significant?

2 years ago

Phone Pe, which is an online wallet owned by Flipkart, announced that ICICI Bank would be their new partner bank for creating and using UPI IDs for online payments. It may be recollected that Phone Pe had to undergo a temporary stoppage in service on the day when Yes Bank had been forced into liquidation by the RBI as it was the facilitating bank.

Customers can now use the @ibl handle of ICICI Bank to create and use UPI IDs in the Phone Pe app. This will be in addition to the @ybl handle of Yes Bank. Since Phone Pe has over 200 million registered users, this gives a back redundancy option where users can deploy multiple UPI IDs can transaction even if one bank's handle is temporarily out of service.

The partnership between ICICI Bank and Phone Pe is expected to capitalise on their domain strengths in order to give customers a seamless digital payment experience. The last time when Yes Bank had been temporarily suspended, it led to mass outage and failed UPI payments since Yes Bank was the only partner bank at that point of time.

Post the Yes Bank fiasco, the National Payment Corporation of India or NPCI had asked all the payment service providers offering UPI payments to use multiple banks as UPI partners. This would ensure that payments don't get disrupted in case of any such outage. This would render more stability to the third payment platforms like Phone Pe.