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1 Team Name: Aarambh, IIM BG Date: 17-08-2022

2 OBJECTIVE

3 To assist Amazon Pay develop a subsidiary Amazon Pay Lite app that enables lightning-fast transactions. The
4 case explores the Bahi Khata (or Ledger) approach that will enable customers to pay for the accrued balance of
5 smaller expenses at the end of the month, while smaller merchants receive payments in a segmented payment
6 schedule.
7
8 METHODOLOGY

9 Amazon Pay intends to implement a secure and reliable lite payment module that streamlines payments for
10 small and medium businesses across India. Customers often opt out of digital payment for small ticket items and
11 pay cash to avoid transaction fees and fear of losing money due to security issues.
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13 MERCHANT & CUSTOMER PAIN POINTS

14 ● Trust issues with respect to security 19 ● Missing payments due to footfall

15 ● Complex user interface 20 ● Lack of transaction management
16 ● Habituated with handling cash 21 ● No insight on the inventory consumed
17 ● Dependent on a mobile internet 22 ● Lack of a compelling reason to switch
18 connectivity
23
24 AAM AADMI KA AMAZON PAY - PAYMENTS SIMPLIFIED

25 ABOUT: A ‘Bahi Khata’ or ledger system of Amazon Pay Later for Customers and Merchants will replace the
26 credit system merchants often face.
27 KEY FEATURES:
28 ● Two-way feature wherein customers can pay an accrued value at the end of the month
29 ● Merchants are incentivized to enable transactions at their point of sale
30 ● Customers are incentivized to make payments by the habit formation method - existing Amazon Prime
31 users get an extension on their subscriptions, and new members are given cashback and added to the
32 incremental subscription model.
33 CUSTOMER SEGMENT:
34 ● Smartphone savvy users above 18 years, who may pay via COD or credit/debit cards.
35 ● Small and medium businesses - both potential and existing who use Amazon Pay merchant platform.
36 ● Low to medium-income group customers - both potential and existing Amazon Prime subscribers.
37
38 ONBOARDING MERCHANTS AND CUSTOMERS:
39 Amazon Pay Lite focuses on this audience for deeper penetration in the rural, semi-rural, and semi-urban areas.
40 Merchants are incentivized to enable transactions at their point of sale with rewards that encourage them to

2 Privileged and Confidential document: The case study is for Amazon Customer Excellence (ACE) Challenge 2022 only and shall not be
3 shared/disseminated further with any third party. All Submissions made responses provided would be retained and used by Amazon in
4 future. Participants cannot to claim IP rights over it
5 1
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41 promote the QR code scanner and discourage cash. When the number of transactions per day exceeds a
42 minimum amount by closing time, merchants can be rewarded with an added bonus. Merchants will be trained
43 to assist customers with setting up Amazon Pay Lite and given general instructions for troubleshooting.
44 Dedicated merchants for KYC authorization will ensure legitimate transactions are enabled from the time an
45 account is set up to authorizing payments to and from the merchants.
46
47 At the same time, customers are incentivized to make payments by the habit formation method, wherein
48 existing Amazon Prime users get an extension on their subscriptions. For instance, Amazon Pay Lite can be
49 gamified to show that n number of transactions will result in n-1 number of days worth of subscription
50 extension, with the end of subscription date extending every time a transaction is made. Potential customers
51 who are not subscribed to Amazon Prime will be incentivized in the form of cashback and exclusive discounts in
52 addition to the Amazon Prime membership. At the common marketplaces such as Government-run grocery and
53 Kirana stores, a customer with a ration card can avail of subsidies through Amazon Pay.
54
55 This methodology takes into account the existing customer database of Amazon Prime for value creation and
56 promotion of Amazon Pay. As customers are onboarded, they are subjected to a stringent KYC process in
57 conjunction with their bank. Long-time customers or returning customers will get due extensions of their
58 subscriptions, whereas potential customers will benefit from the Bahi Khata system and an incentivised number
59 of transactions that fulfill certain threshold amount criteria.
60
61 CREDIBLE DIFFERENTIATORS

62 ● Audience Lever: The Amazon Pay Later option can be used in tea shops where customers transact
63 regularly. The interface will create a khata book-type system that will show all the transaction details of
64 a particular vendor for a month, which is beneficial for both customers and merchants. The same can be
65 used in government schemes for the distribution of subsidized goods.
66 ● Platform Lever: Make the interface more easily accessible for fast transactions with the new lite
67 payment app. We use the resources of AWS for creating a better user interface for the UPI transactions
68 and khata book maintenance.
69 ● Creative Marketing Lever: Creating one wallet system for under 18 adults for pocket money spending
70 where the parents can put in the required amount of money and the children can use it for the monthly
71 spending purpose.
72 ● CTA Lever: We can provide faster delivery as a benefit to the retail orders if it’s paid through Amazon
73 Pay and Pay Later option.
74 ● Nurture Lever: Incentivising customers and merchants with a reward system on a daily limit and monthly
75 basis with the n days of free Amazon Prime and Music membership, and retail discounts if one gets
76 enough monthly rewards.
77
78 APPENDIX I

7 Privileged and Confidential document: The case study is for Amazon Customer Excellence (ACE) Challenge 2022 only and shall not be
8 shared/disseminated further with any third party. All Submissions made responses provided would be retained and used by Amazon in
9 future. Participants cannot to claim IP rights over it
10 2
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79 1. India had 1.2 billion mobile subscribers in 2021, of which about 750 million are smartphone users. It is
80 poised to be the second-largest smartphone manufacturer in the next five years. - Deloitte Study
81 2. PhonePe and Google Pay continue to maintain their lead as the most popular UPI payment apps, with
82 the two apps enjoying market shares of 44% and 35%, respectively, in the first six months of 2021.
83 PhonePe continues to lead as per July 2022 NPCI data.

84 3. IIM Bodh Gaya Sample Survey

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12 Privileged and Confidential document: The case study is for Amazon Customer Excellence (ACE) Challenge 2022 only and shall not be
13 shared/disseminated further with any third party. All Submissions made responses provided would be retained and used by Amazon in
14 future. Participants cannot to claim IP rights over it
15 3
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17 Privileged and Confidential document: The case study is for Amazon Customer Excellence (ACE) Challenge 2022 only and shall not be
18 shared/disseminated further with any third party. All Submissions made responses provided would be retained and used by Amazon in
19 future. Participants cannot to claim IP rights over it
20 4