Adani Group eyes e-commerce expansion, entry into India’s digital payments market: Report

Adani Group, the Indian business conglomerate helmed by Gautam Adani — India’s 2nd richest — is now setting its sights on a significant slice of the country’s rapidly growing digital commerce and payments sectors. According to reports, the sprawling conglomerate is considering applying for a license to operate on the Unified Payments Interface (UPI) and is in talks with banks to launch a co-branded credit card. This is a big departure for Adani, which has, for years, maintained a strong network of ports, airports, power plants, and mining operations. In recent years, the group also diversified into areas like renewable energy, edible oils, and data centers but hasn’t really tried its luck in the ecommerce space.

With this development, the conglomerate is set to enter a competitive arena already occupied by established tech giants like Google, Walmart-backed Flipkart and PhonePe, along with rival Mukesh Ambani’s Jio-owned Ajio among others. By integrating with UPI, Adani can position itself as a viable alternative for the millions of Indians who rely on the network for everyday digital transactions. For those who need a refresher, UPI has rapidly become the backbone of India’s digital payments infrastructure, handling billions of transactions monthly. As of April, PhonePe holds a commanding 48.9% market share in the UPI space, followed by Google Pay at 37.7%. According to Mordor Intelligence, the Indian payments market is projected to grow from $357.51 billion in 2024 to $814.43 billion by 2029.

Furthermore, the upcoming co-branded card would broaden the scope of Adani’s financial services offerings, which could potentially attract new customers. Co-branded credit cards, for those who are unaware, typically provide benefits related to the partner company’s products and services, which in Adani’s case could span from travel and logistics to energy and retail. By offering a financial product, the group can tap into the growing credit card market in India, which is witnessing increased adoption as more consumers shift towards digital transactions and online shopping.

And if this is 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 like Amazon and Flipkart. This collaboration between Adani and ONDC would be mutually beneficial – Adani would gain access to ONDC’s vast and interoperable network, reaching a large pool of potential customers without the significant investment required to build a proprietary e-commerce platform.

On the other hand, ONDC would benefit from having a major player like Adani on board. If Adani’s plans materialize, these services would be accessible through the Adani One app, launched in December 2022. Adani One currently offers services such as travel bookings, and its integration with ONDC would significantly expand its scope. The integration of payments, e-commerce, and travel booking functionalities within the Adani One app would, then, offer a one-stop shop for various digital needs. This move into e-commerce comes as the Indian retail market continues to grow, with analysts estimating it will be worth $1.27 trillion by next year.