PhonePe Switch as an Embedded Commerce Platform

Industry & Competitive Context

PhonePe launched Switch in a payments market where the main apps were also trying to become distribution channels for other businesses. When Google Pay announced its Spot platform in September 2019, it let merchants build a customised in-app menu inside the payment app. Google also let developers convert existing websites and progressive web apps into a Spot with a few lines of JavaScript. Reporting at the time compared that to PhonePe’s Switch, and put Google Pay at 67 million monthly active users against PhonePe’s 55 million. PhonePe’s own release the same day cited a different figure for itself, over 60 million monthly active users. Sources therefore disagree on the size of the audience Switch was competing for.

Paytm followed in October 2020. Its Mini App Store is a web-based service inside the Paytm app, not a downloadable store. Paytm said listed apps would need to integrate with its payments gateway. Paytm also reported more than 300 apps joining, including Decathlon, Ola and Domino’s.

The category had an international reference point. KrASIA described WeChat’s mini-programs, which let businesses run lightweight apps inside the host app, as the model these Indian initiatives resembled. The same article records analyst skepticism about whether the model would transfer to India. KPMG’s Anand Vermani argued that Indian users tend to prioritise value over convenience or brand loyalty and compare prices across platforms. He also noted that India already had specialised apps in most major categories before the super-app idea took hold.

Brand Situation Prior to Launch

By 2019 PhonePe was already established as a payments brand. Its September 2019 release described it as accepted at 60 lakh merchant outlets nationally. Its stated ambition went beyond payments: PhonePe’s Sonika Chandra said the 2016 idea was to facilitate all kinds of customer-merchant transactions, not only payments.

Switch had a prior life under another name. PhonePe’s in-app platform was earlier called “Apps” and launched in June 2018, with close to 50 partners and a plan to reach 500 by end-2019. The launch date is not consistent across sources. A PhonePe statement to The News Minute in 2020 said Switch launched in March 2018. The September 2019 event was a rebrand and repositioning: PhonePe announced “PhonePe Switch” (earlier called “Apps”) as a one-click entry point to a world of apps on its platform.

The platform also had an existing base of use. PhonePe said it had registered close to 65 million transacting customers, and its CEO claimed 30–40 percent of them visited the in-app platform. That is a company claim reported by YourStory.

Strategic Objective

PhonePe’s public statements describe the objective on two sides. For consumers, the goal was a convenient way to access and engage with multiple apps. For partners, it was distribution. Rituraj Rautela, head of the apps platform, called Switch a new distribution platform where partners “may see” lower acquisition costs for new users. He added that developers could run targeted offers and test new features faster on PhonePe’s user base.

PhonePe’s release was specific about what different partner types could gain: start-ups could acquire high-quality users at low cost, while larger partners could get help driving non-cash payments and growing in select geographies.

The wider ambition was stated by the company and characterised by press. PhonePe’s Chandra said Switch is “part of our broader super app play.” Business Standard described Switch as a major part of a strategy to become an internet services aggregator. That is the publication’s characterisation, not a PhonePe statement.

Platform Architecture & Execution

The mechanism is documented in PhonePe’s own materials. Merchants integrate an existing PWA or mobile site, and users log in to partner apps without downloading them, with a single tap. PhonePe’s developer documentation defines Switch as a platform for hosting merchants’ React Native, PWA or mobile-site applications inside the PhonePe app. In the example it gives, travel merchants appear within a “Travel & Transit” section organised by subcategories such as flights, bus and train. When a user taps a merchant, the merchant’s site opens inside PhonePe and payment is completed within the app.

The documentation shows how much of the stack PhonePe supplies. It covers single sign-on, payments, device capabilities (location, camera/QR scanning, file picker), a customised deeplink API, and cart-detail schemas for categories including flights, hotels, food and shopping. It also includes pages on submitting an app for review and the process of going live, so partners pass through a gate. A PhonePe spokesperson drew a boundary around the product: it is a web-apps platform rather than a mobile app store.

The partner roster built up in stages. At the 2019 relaunch it included Ola, redBus, Goibibo, Myntra, Delhi Metro and Grofers. In January 2020, OnMobile launched a gaming app on Switch, and PhonePe’s Switch head said partners could reach 65 million monthly active users. In March 2020, PhonePe integrated Swiggy, with exclusive offers for Switch users and a flow that took the user from the Switch icon to restaurant selection and payment. By 2021, KrASIA listed healthcare, education and gaming among the categories on Switch alongside food, grocery, shopping, entertainment and travel.

Positioning & Consumer Insight

The consumer-facing position is stated plainly: users do not need to download apps or keep them on their phones. The use cases PhonePe emphasised were high-frequency ones, ordering food, shopping and travel. The partner-facing position is distribution plus tooling, covering offers, targeting and fast feature testing.

That includes any documented insight about why users would transact with third-party merchants inside a payments app. The stated rationale is convenience and removal of install friction, and the documents reviewed do not go further.

Positioning was also contested. Medianama said of Paytm’s comparable product that such offerings are, at best, sections of an existing app, though a gallery inside a large app is a useful discovery resource for businesses. That criticism applies equally to the model Switch pioneered, and it frames the positioning question: is a hosted web app inside a payments app a distinct product, or a distribution shelf?

Media & Channel Strategy

The primary channel was PhonePe’s own app, with the Switch icon as the entry point. The announcements reviewed came through PhonePe’s blog and press releases. Partner-level promotion was by exclusive offers for Switch users. The developer documentation adds a customised deeplink API under “Marketing and Communication Solutions”.

Business & Brand Outcomes

Growth claims. In 2019 PhonePe said the Switch distribution platform had grown 400% in the last six months. The metric, base and measurement are undisclosed.

Partner count. Documented figures are about 50 partners in September 2019 (against a stated target of 500 by end-2019), over 100 live partner apps in March 2020, over 220 apps in October 2020 and 645 apps in KrASIA’s 2021 reporting. The sources reviewed do not report a year-end 2019 count, so whether the 500 target was met is unverified.

Acquisition cost. This is the one cost-efficiency claim on record. Chandra told KrASIA that several partners reported Switch as their most cost-effective acquisition channel, with 40% lower customer acquisition cost than conventional channels. It is a PhonePe executive’s account of unnamed partners’ experience. The partners, the benchmark channels and the method are not disclosed, and it has not been independently verified.

Audience. The 60–65 million and 125 million monthly active user figures describe the PhonePe app, not Switch users. KrASIA’s 125 million figure is for PhonePe’s monthly actives overall.

Financial disclosure. PhonePe’s 2025 IPO filings give company-level scale. For example, one summary reports 65.76 crore registered users and 4.72 crore merchants as of September 2025. The coverage reviewed does not break out Switch.

Current status. PhonePe’s developer portal still carries a Switch section in 2026 (documentation covering SSO, payments, device capabilities and go-live).

Adjacent moves. PhonePe later tried operating commerce itself. In December 2025, TechCrunch reported that PhonePe shut down its Pincode e-commerce app and said it would shift towards B2B services for offline merchants. The same report framed Switch as an earlier e-commerce move, launched in 2019 as a super-app layer offering food, grocery, shopping and travel. Separately, PhonePe has rebranded Indus Appstore as PhonePe Appstore, saying it is present on more than 200 million devices. It is pitched to developers on integrated payments, advertising and business insights.

Strategic Implications

The model separates distribution from operation. The documented record shows two commerce models. In Switch, PhonePe hosts partners’ existing web properties, adds identity, payments and tooling, and leaves inventory and fulfilment to the merchant. With Pincode, it operated a commerce app itself and later wound it down. This is an interpretation of two documented facts, not a PhonePe statement. The contrast suggests the asset PhonePe could most credibly monetise in commerce was access to its payments user base rather than its own retail operations.

The mechanism was easy to replicate, so the moat had to be elsewhere. Google Pay and Paytm built comparable web-based in-app models, and both launched around the same time or within about a year (September 2019 and October 2020). Because these models rely on web standards, the difference between them lay in audience, partner roster and payments integration, not in the technology. This is an analytical reading of the competitive record.

Claims of success remain company-sourced. The 400% growth, the 30–40% visit rate and the 40% CAC advantage all come from PhonePe or its executives. External commentary in the record is more cautious. Convergence Catalyst’s Jayanth Kolla said both Paytm and PhonePe had faltered on execution of their super-app strategies. He added that merely hosting third-party apps does not make a company a super app. A rigorous reader should treat Switch’s outcomes as asserted rather than demonstrated.

Embedded commerce became a layered strategy. Switch (partner web apps), Pincode (own commerce, since closed) and PhonePe Appstore (developer distribution) show repeated attempts to extend the payments relationship into commerce and distribution, with different degrees of operational involvement.

Discussion Questions

1. PhonePe describes Switch as a distribution platform for partners. What evidence would you need to judge whether it reduced customer acquisition cost, given that the 40% figure is partner-reported and undisclosed in method?

   
   

2. Google Pay’s Spot and Paytm’s Mini App Store were comparable web-based models. When the technology is replicable, what sources of advantage can an embedded commerce platform build, and which are documented here?

   
   

3. Switch hosted partners’ existing sites, while Pincode involved PhonePe operating commerce directly. Compare the two models on capital intensity, control of customer experience and strategic risk.

   
   

4. Which metrics should a payments company disclose for an embedded platform (for example GMV, partner retention, cohort conversion) so outside analysts can evaluate it? What does the absence of such disclosure here limit?

   
   

5. Analysts cited in the record argued that Indian consumers compare prices across platforms and that specialised apps may serve them better than super apps. How does this challenge the “convenience without download” proposition, and how might a platform owner respond?