Zomato rolls out its own UPI offerings

Zomato is going to offer payments through Unified Payments Interface as a third-party application provider. It has partnered with ICICI Bank to offer both merchant and peer-to-peer payments. The move is expected to enable the foodtech company to list its own UPI offering for payments. 

The introduction of Zomato UPI will help customers to now sign up to create a new UPI ID after which they will be able to make payments by staying on the Zomato app itself. They will not be redirected to another app like Google Pay, PhonePe, or others, as is the case for certain users currently. 

Zomato is also hopeful that customers find the new arrangement less cumbersome and increasingly opt to make UPI payments, moving away from cash on delivery (COD) orders. Since COD orders are difficult to manage and come with an added cost of handling the money, Zomato is trying to eliminate. There are also risks that a customer refuses to accept an order if they have opted for a COD option. 

With the introduction of Zomato UPI, the company will gain more control over the success rate of payments and rely less on third-party apps and their functioning, which can push up customer satisfaction at a time when the food delivery market is slowing. 

For now, Zomato UPI is only a pilot of sorts. Depending on the adoption rate and customer stickiness, the company will either approach more banks or go slow with the rollout.