Amazon Pay (India) Pvt. Ltd, the local digital payments arm of global e-commerce major Amazon.com Inc., has seen its operating revenues increase but its losses widen for the financial year ended March 2018, filings with the Registrar of Companies show.
In 2017-18, Amazon Pay reported operating revenues of Rs 389.1 crore, up from Rs 4.1 crore in 2016-17.
The company’s net loss rose to Rs 334.2 crore in 2017-18 from Rs 177.9 crore in the previous year.
Total expenditure stood at Rs 727.7 crore in the period under review, as compared to Rs 185.4 crore in the year prior. The company spent Rs 81.4 crore on employee benefits and Rs 44.7 crore went towards other expenses, the filings stated.
Email queries sent to Amazon, seeking comments on its financial performance did not elicit a response at the time of filing this report.
Amazon Pay’s rival, PhonePe Pvt. Ltd, the in-house payments arm of e-commerce major Flipkart, also saw its revenues rise due to significant cash burn for the financial year 2017-18.
The firm’s operating revenues grew to Rs 42.79 crore, up from Rs 3.02 crore in the previous year.
For 2017-18, gross expenses rose nearly six-fold to Rs 840 crore, up from Rs 146.34 crore in the year prior.
The company spent heavily on marketing and promotions, which amounted to Rs 602.28 crore, accounting for nearly 72% of the total expenditure. This was followed by employee expenses which came to around Rs 130.12 crore. Put together, these two categories alone accounted for nearly 88% of PhonePe’s total expenditure incurred.
Seattle-based Amazon has been pumping money into its payments arm in the past couple of years.
In July this year, the company received Rs 230 crore ($33.6 million then) in fresh capital from its parent. The round valued Amazon Pay India at around Rs 1,067 crore ($156 million).
It was also Amazon Pay’s third funding round after the payments company increased its authorised share capital by five times to Rs 2,000 crore last October. It had received Rs 195 crore in March this year and Rs 260 crore in October 2017, regulatory filings show.
Previously, Amazon Pay had received Rs 67 crore and Rs 130 crore in May 2017 and July 2017, respectively.
The e-commerce giant, which competes with Walmart-owned Flipkart in India, has been investing frequently in its various Indian businesses as part of efforts to capture a dominant share of the country’s online retail market. Its focus on digital payments, a critical piece of the Indian e-commerce puzzle, is part of that strategy.
In May, media reports said it invested an undisclosed sum in Bengaluru-based Naffa Innovations Pvt. Ltd, which operates mobile payments technology platform ToneTag.
In February, it had hired Mayank Jain, the former head of financial services at rival Flipkart. Credited with launching Flipkart’s ‘Buy Now, Pay Later’ scheme, he focus at Amazon Pay is on strategic initiatives.