Walmart-backed PhonePe is killing off its Pincode app in another e-commerce step backwards

In its latest withdrawal from India’s crowded online retail market, PhonePe, the Walmart-backed fintech giant, has exited its e-commerce app Pincode and will shift the business towards B2B services for offline merchants.

Sameer Nigam, founder and group CEO of PhonePe, said on Thursday that running a consumer-facing express commerce app has become a distraction from the company’s primary focus on small retailers. The company instead wants to focus on helping stores “achieve operational efficiencies and improve margins and visibility,” he said, noting that is its primary goal.

PhonePe Fired Pincode in April 2023 as a major push into e-commerce, building on the Indian government-backed Open Network for Digital Commerce (ONDC). Hyperlocal app delivers grocery, medicine, food, electronics and home decor from nearby stores. It was first rolled out in Bengaluru and later expanded to other cities.

Within just over a year of launch, Pincode was launched Withdrew from most categories Except for food. Earlier this year, the app Switched to a quick trade modeloffers 10-minute delivery through local Kirana stores and retailers in cities like Bengaluru, New Delhi, Mumbai, Hyderabad and Pune. The company also expanded the service to include 10-minute medicine delivery in Bangalore, Mumbai and Pune in April.

PhonePe’s Pincode used local stores and retail stores for quick deliveries – in contrast to competitors like Swiggy, Zomato-owned Blinkit and Zepto, which rely on dark stores. This shift did not help Pincode make inroads in the crowded segment, prompting PhonePe to end the service.

Pincode was not PhonePe’s first step into e-commerce. In 2019, the company launched “switch” A super app layer within its payments app that provides access to food, grocery, shopping and travel services.

PhonePe has now turned off the Pincode app and Redirected his website To the main PhonePe website. The company said it will now focus on working with offline retailers by expanding its B2B offerings. In July, PhonePe said it had digitized over 1,000 local stores in Bengaluru, Pune, Delhi NCR, Hyderabad, Mumbai and Varanasi through Pincode, giving them access to digital storefronts, inventory tools and last-mile delivery services.

“As part of this strategic decision, we will now focus the resources of the entire Pincode team towards accelerating the creation and scale of a suite of B2B business solutions for offline businesses across India,” Vivek Loship, CEO, Pincode, said in a prepared statement.

PhonePe already offers inventory and order management tools, as well as other ERP software for small businesses, and provides direct sourcing and replenishment services in some categories.

This shift comes as PhonePe prepares for a public listing in India, nearly three years after its launch. A spin-off from Flipkart. Company Submitted draft papers With the Securities and Exchange Board of India through the confidential pre-filing route in September and targeting a listing in mid-2026. PhonePe is also looking for ways to grow beyond its position as the country’s dominant payments app on the Unified Payments Interface.

PhonePe did not respond to detailed questions about Pincode’s performance and the timing of the app’s shutdown.