Pincode was spearheaded by PhonePe, the Walmart-backed fintech behemoth that has quickly become India’s most valuable startup. This app, released in April of this year, is just the latest piece in PhonePe’s massive plan to expand into the online retailing space. PhonePe is preparing for an initial public offering in India. This strategic wisdom represents a significant departure from the more consumer-facing services to a more business-to-business solution.
Pincode was built off the back of the Indian government-funded Open Network for Digital Commerce (ONDC). The app helped people access essential goods for same-day delivery via nearby local kirana shops and small retailers. It originally debuted in Bengaluru but soon spread to the other large cities. Today, it delivers groceries and other essentials in just 10 minutes in New Delhi, Mumbai, Hyderabad and Pune.
As the company works to diversify its service offerings, PhonePe introduced 10-minute medicine deliveries. This ambitious new program launched in major municipalities including Bangalore, Mumbai, and Pune in April. By July, Pincode had digitized more than 1,000 local stores in Kerala, Sikkim and Arunachal Pradesh. Through this pilot, these stores gained access to digital storefronts, inventory management systems, and last-mile delivery solutions.
Just over a year after launching, Pincode reached a fork-in-the-road moment. It left the space, in the face of healthier competitors, and dramatically retreated from the market – concentrating on just food delivery. This contraction reflects broader challenges within the e-commerce market as competition intensifies and consumer preferences shift.
PhonePe’s founder and group CEO, Sameer Nigam, has been vocal about the company’s commitment to innovation and adaptation in a rapidly changing digital landscape. The company is moving in a very different direction from Pincode’s original mission. It’s now looking to build B2B services tailored to those offline merchants in every corner of India.
We spoke to Vivek Lohcheb, the CEO of Pincode, to understand the thinking behind this strategic pivot.
“As part of this strategic decision, we will now focus the entire Pincode team’s resources towards accelerating the build-out and scale-up of a suite of B2B business solutions for offline businesses across India,” – Vivek Lohcheb.
The decision to wind down Pincode aligns with PhonePe’s overarching strategy to bolster its business model ahead of its anticipated public offering. This latest trend is indicative of how tech companies are consistently making things more efficient. They are zeroing in on core competencies that dovetail with their long-term growth goals.
Pincode might no longer function as an e-commerce platform, but PhonePe is still committed to empowering mom-and-pop shops. Their B2B solutions show a distinct pivot away from competing directly with the consumer, towards the goal of empowering businesses. This transition may help strengthen the digital infrastructure for offline businesses in India, ensuring they remain competitive in an increasingly digital economy.
