PayPay recently announced significant changes to its service, causing a stir among users.
The company stated that as of August 1, 2023, it will stop accepting credit cards and remove existing registrations.
However, PayPay Card and PayPay Card Gold, issued by PayPay Card, a subsidiary of PayPay, can still be used by registering for "PayPay After Payment."
Another notable change is introducing a 2.5% fee for recharging PayPay balances via "SoftBank/Wymobile Collective Payments" starting August 1, 2023.
The first recharge per month will remain free, but subsequent refreshes will be charged.
These changes have been met with criticism on social media, as they benefit the company more than its users.
PayPay's decision aims to reduce the burden of fees and increase revenue.
However, credit cards from other companies were often excluded from the points incentives, leading to a decline in users using PayPay with cards from other companies.
PayPay's significant presence in smartphone payments using QR codes has allowed the company to maintain its confident stance despite user dissatisfaction.
As a result, PayPay has experienced rapid growth, with transaction volume exceeding JPY 10 trillion in just four and a half years.
The company began collecting commissions from merchants in October 2021 and is moving toward monetization.
Market conditions and the struggles of its parent companies, SoftBank and Z Holdings, may have influenced PayPay's recent actions. Both parent companies own 34.9% of PayPay, making it a consolidated subsidiary.
Z Holdings merged with LINE to form the current Z Holdings, but overlapping businesses must be reconciled.
In addition, SoftBank's performance has deteriorated since FY2021 due to mobile phone price cuts.
PayPay is currently operating at a loss and is expected to become profitable once it shifts its focus from business expansion to profitability.
PayPay's potential profitability and listing could become growth drivers for its parent company.
First, however, the company must balance monetization and user value to avoid stagnation due to increasing user dissatisfaction.