How PhonePe Earns Money? (PhonePe Business Model Revealed)
phonepe business model - how phonepe earn money

PhonePe is a digital payment application that maintains and hosts your online transactions and provides other services through the Internet on its platform.

Nowadays, many other companies offer you the same features as PhonePe. National Payments Corporation of India (NPCI) has evolved its technology and provided UPI to make transactions appropriate.

In the era of digitalization, UPI companies are the leading wave. In the data-driven market, they frequently place a very high value on themselves.

UPI recorded over 14.55 billion transactions for a total of Rs. 26.19 trillion in Q1 2022.

Therefore, in this context, we will discuss how PhonePe earns money.

About PhonePe

PhonePe is a well-established Indian digital platform which was initiated in the year 2015 by Sameer Nigam, Burzin Engineer, and Rahul Chari.

The UPI (Unified Payments Interface) transactions served as the foundation for the application. The headquarters of PhonPe is in Bangalore, India.

PhonPe is a digital application that provides 11 different Indian languages at no extra cost. It has some features such as mobile recharge, receiving and sending money, DTH, utility payments, tax savings funds, data cards, and many more. 

PhonePe has received a license from the Reserve Bank of India to provide money transfer services and an authorized-based payment system.

Phonepe has acquired a huge number of users over 280 million and established payment systems for more than 17 million merchandisers, in around 500 cities in India.

PhonePe Business Model

In addition to money transfers from one bank to another bank, Phonepe has turbulent features such as insurance, food, gold, loans, purchase grocery through PhonPe, and many more. It has also offered diurnal services like mobile recharge, electricity bills, and other household bill payments.

PhonePe is a kind of super app that provides all the features in one application. Those products are available in this app that provides a little discount.

PhonePe has charged the commission on the payments made by customers from any online or offline merchants.

Read: Nykaa Founder Falguni Nayar's Success Story

The UPI transactions are based on IMPS which is why it doesn't charge any extra commission from the banks.

Recently, PhonePe has introduced its own POS machine that is almost available at every store that enables PhonePe payment. The POS(Point of Sales) machine made payments more accessible and more convenient for merchants. 

PhonePe POS machine is powered by Bluetooth technology and is the world's lowest-cost POS device in the world.

How PhonePe earns money?

Here are several sources of how Phonepe earns money below:

1. Mobile Recharge

We all know that PhonePe provides online mobile recharge services (Prepaid and Postpaid) to your mobile very easily.

Hence, Phonepe earns a commission from the telecom operator when recharging is done and recently, it charges platform fees in the range of ₹1 to ₹2 per transaction mobile recharge done for above ₹50.

2. Bill Payment

When a bill payment is made through the PhonePe application on the mentioned company, PhonePe earns a commission from the respective company.

3. Gift Vouchers

On PhonePe, you may find several gift vouchers for many applications, like Oxigen Wallet, Airtel Money, Freecharge, and others. If you buy gift Vouchers from PhonePe, you get a commission on every sale.

4. Apps & Offers

On PhonePe, there are different types of apps like Dominos, OYO Rooms, Flipkart, Zomato, and many more. Hence, PhonePe earns a commission if you have made any payment on these mentioned apps.

5. Digital Gold

PhonePe allows users to buy digital gold. When you buy digital gold, PhonePe charges a little extra from you than the actual pricing.

6. Mutual Fund

PhonePe also included the unique feature that is a mutual fund in its app. When an investor purchases any mutual fund scheme from the PhonePe application, it charges a percentage of commission on the respective company.

7. UPI (United Payment Interface)

PhonePe usually does not make money from UPI transactions. It only analyzes your data to develop a new product.

Revenue Model of PhonePe

PhonePe does not have its own payments bank. When you send any money back to your account, it does not charge any fees. It even gives you different offers and cashback for the money you paid through transactions.

The major percentage of the revenue of PhonePe comes from recharges and bill payments. Also, PhonePe is promoting several brands on its application with special offers and vouchers. 

Read: Reliance Retail Ventures Limited Success Story

PhonePe earns revenue from Yes Bank by providing the analytic database and targeting its products to the users. Flipkart also uses the service to track purchases to find better advertising, offers, and notifications for users via PhonePe.

By preventing the channelling of other payment apps, it collects and saves a sizable sum of money from Flipkart.


PhonPe is not a payment bank like Paytm and Airtel Money. It is a fintech startup with a service not based on banking services.

Now, PhonePe is enjoying a monopoly with a market share of 47% and provides safe and secure online transactions.

PhonePe facilitates services, payments, and online transactions for several products available on the PhonePe application, website, or any other third-party merchant storefronts (online or offline). PhonePe also provides wallet services just like Paytm and Amazon Pay.

Phonepe is a very widely accepted payment platform across India with superior services and great offers.

PhonePe offers the best features and offers for payment and generates revenue in a completely conventional way.


Who is the founder and CEO of PhonePe?

Sameer Nigam is the founder and CEO of PhonePe.

How much of the valuation of PhonePe?

PhonePe company valuation stands at $5.5 Billion.

Who are the top competitors of PhonePe?

PhonePe ‘s top competitors are Paytm, G-Pay, Amazon Pay, etc.

Does PhonePe charge for money transfers?

PhonePe does not charge for money transfers.

Does Flipkart acquire PhonePe?

Yes, Flipkart acquired PhonePe in April 2016.

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