Adani Group hopes to expand e-commerce and enter the Indian digital payments market: report

Adani Group, an Indian business conglomerate headed by Gautam Adani – India’s second-richest resident – is currently focusing on a significant portion of the country’s fast-growing digital commerce and payments sectors. The sprawling conglomerate is reportedly considering applying for a license to operate under the Unified Payments Interface (UPI) and is in talks with banks to launch a co-branded credit card. This is a big change for Adani, which has maintained a strong network of ports, airports, power plants and mining plants for years. In recent years, the group has expanded into areas such as renewable energy, edible oils and data centers, but hasn’t really tried its luck in the e-commerce space.

With this, the conglomerate will enter a competitive arena already occupied by established tech giants such as Google, Walmart-backed Flipkart and PhonePe, as well as rival Mukesh Ambani’s Jio-owned Ajio, among others. By integrating with UPI, Adani can become a viable alternative for millions of Indians who use the network for everyday digital transactions. For those needing a refresher, UPI has quickly become the backbone of India’s digital payments infrastructure, handling billions of transactions per month. As of April, PhonePe has an impressive 48.9% market share in the UPI space, followed by Google Pay with 37.7%. According to Mordor Intelligence, the Indian payments market is expected to grow from $357.51 billion in 2024 to $814.43 billion in 2029.

Moreover, the upcoming co-branded card would expand the scope of Adani’s financial services offering, which could potentially attract new customers. Co-branded credit cards, for those who aren’t aware, typically provide benefits related to the partner company’s products and services, which in Adani’s case can range from travel and logistics to energy and retail. By offering a financial product, the group can tap into India’s growing credit card market, which is seeing increasing usage as consumers shift towards digital transactions and online purchases.

And if that’s not enough, the Adani Group is also exploring opportunities in the e-commerce sector. According to media reports, the conglomerate is considering offering online shopping services through the government-backed Open Network for Digital Commerce (ONDC). ONDC aims to democratize digital commerce by providing an open platform for buyers and sellers, reducing the dominance of established e-commerce giants such as Amazon and Flipkart. Adani and ONDC collaboration would be mutually beneficial – Adani would gain access to ONDC’s extensive and interoperable network, reaching a large pool of potential customers without the significant investment required to build its own e-commerce platform.

ONDC, on the other hand, would benefit from having an important player like Adani on board. If Adani’s plans are realized, these services will be available through the Adani One application launched in December 2022. Currently, Adani One offers services such as travel bookings and integration with ONDC would significantly expand its scope. Integration of payment, e-commerce and travel booking features on the Adani One app would therefore provide a one-stop solution for various digital needs. This shift towards e-commerce comes as the Indian retail market continues to grow, with analysts estimating it to be worth $1.27 trillion by next year.