- 99Pay’s director told Reuters that expects to reach the end of the year as one of the three largest digital wallets in Brazil in terms of active users;
- Launched last year, 99Pay currently operates in nine cities, with 500,000 users;
- The goal is to reach 99’s twenty million active users, a group served by nearly 700 thousand drivers in 1,600 cities in the country.
99 will scale up its 99Pay digital wallet in Brazil, betting on a benefits package and the recurring use of its ride-hailing app to face giants with tens of millions of users, such as PicPay and Mercado Pago.
“We expect to end 2021 as one of the three largest digital wallets in the country in terms of active users,” Maurício Orsolini Filho, director of 99Pay, told Reuters.
The plan shows how the company bought three years ago by the Chinese group Didi Chuxing plans to expand mechanisms to retain customers, in the dispute with its biggest rival Uber in the country and at the same time seek options to monetize the base.
Launched last year, 99Pay currently operates in nine cities, with 500,000 users, said the executive. The goal is to reach 99’s twenty million active users, a group served by nearly 700 thousand drivers in 1,600 cities in the country.
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The push comes months after digital wallets speeding up in the country, with social isolation measures related to the COVID-19 pandemic leading millions of people to seek online methods to pay for purchases or to receive emergency funds from the government.
PicPay, for instance, tripled its base last year, reaching 41 million accounts. In addition, retail chains in the country are expanding or launching their own digital wallets, in general, supported by costly subsidies.
While not revealing the amount of the investment, 99Pay goes the same way, with offers that include everything from a 220% return on CDI (interbank deposit rate) resources on the account, to discounts on 99 trips and 99Food orders.
Although they see the movement with some optimism, given that this has contributed to reducing the unbanked population, experts in the banking sector have pointed out that the digital wallet market in Brazil is likely to go through consolidation, given that a large share of these customers is redundant, that is, one can be a user of several brands at the same time.
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Few digital account businesses, however, will be able to survive profitably and this will rely heavily on which companies will be able to maintain the recurrent use of their base.
For Orsolini Filho, having the digital wallet under the same group that includes a ride-hailing and meal ordering apps, 99 benefits from having a higher level of use, even if it has a smaller base. And it is precisely this criterion the company uses when forecasting that it will be one of the largest in the country, referring to accounts used at least once in the last 30 days.
And in an effort to optimize the wallet usage, the company has expanded the service portfolio, including the option for the passenger to make a credit on the account with the driver himself, who in turn receives a 5% bonus on the transfer amount.
The app will also allow the difference in the value of trips paid in cash to be returned on 99Pay, in addition to letting users transfer amounts between themselves.
The goal is, naturally, to reduce payments made in cash, which currently represents about 70% of trips. According to the exec, in the cities where 99 already operates the digital wallet, this number dropped to 60%.
READ ALSO: Brazil’s instant payments system, PIX already accounts for 78% of bank transfers in the country
The next steps to try to further reduce this index will be an option for public transportation payment directly in the digital wallet, integration with the instant payment system PIX, and a credit card offer, still in the first half of this year.
Orsolini Filho says, however, that there are no plans at the moment to expand the portfolio to products such as insurance and investments, for instance.
“We are only going to offer financial services that make sense to the digital wallet,” he said.
Translated by LABS