Google Pay is launching a credit card in India, linked to the highly popular Unified Payments Interface (UPI) network. This co-branded card, Flex by Google Pay, could serve as a pilot for further global expansion.
The digital card is issued through the Google Pay app and can be used both online and in physical stores. It offers a rewards program, tools to monitor spending and bills, and flexible repayment options, including full balance repayment or installment plans.
According to Google, the full rollout will take several months.
“In India, while digital payments have become ubiquitous, transactional credit remains underpenetrated,” said Sharath Bulusu, Senior Director of Product Management at Google Pay in a blog post. “We see an opportunity to simplify and reimagine this experience for the next generation of card users.”
Seeking a New Revenue Source
Google Pay is already widely used in India, having processed about 7.2 billion UPI transactions in October alone, second only to the PhonePe payments app. However, person-to-person payments on the UPI network generate relatively little revenue. Introducing a credit card would provide Google Pay with a substantial new income stream in the Indian market.
Although India has a population of more than 1.4 billion people, fewer than 50 million currently hold a credit card, indicating strong potential for growth in this area.
“It will not take long for the product to scale to one million cardholders in India,” said Brian Riley, Director of Credit at Javelin Strategy & Research. “The Reserve Bank of India (RBI) has taken the lead to democratize credit in that country, with strong efforts to build modern consumer protections, increase competition, and grow digital and consumer payments Mastercard, RuPay, and Visa networks.”
A Dream Market
The Flex card is a partnership with Axis Bank. Google Pay plans to expand Flex to additional banking partners in the future. With more than five billion users engaging with its search functions, Google represents a potentially lucrative market for financial services.
“Google users are a credit card marketer’s dream,” said Riley. “You can bet that if they find success in the Indian subcontinent, they will discover co-brand partners to issue with top banks in their other top markets, which include the United States, Japan, Brazil, and Germany.”
