In a country which is predominantly cash based and where the physical currency comprises of nearly 11% of the country’s GDP, the Govt’s demonetisation has ushered in a new wave of electronic transaction. Choosing between standing in long queues and getting their daily needs addressed electronically, many hithertho strong believers in cash also are resorting to cashless transaction. It is therefore needless to add that the payment industry has received a big boost and there is a sudden spike in its growth trajectory.
Infact digita prepaid wallets have received great acceptance in recent weeks. Estimates indicate that some of the leading players in this segment have an aggregate stored wallet value close to 117 million. With humble beginnings as a mode of transaction for telecom recharge and bill paymentsdustry, they are the most commonly used transaction adopted even by the likes of vegetable vendors, laundry industry and even the street food vendors. Not only have these digita wallet players simplified transactions but also made electronic transfer accessible to the many Indians who are not computer literates and who might ot be able to read and write anything beyond their name. It is but obvious then that several e-commerce players have now partnered with leading wallet players.
Banks too are responding to this changing trend with focus shifting more towards banking using social media, linking bank accounts to these digital wallets, enabling direct person to merchant links and the like for a better and a quicker response time and bringing their services at par with the need of the times.
However it’s not a smooth ride yet and the payment industry does have to overcome a few challenges including the operation module and its long term impact on profitability, breaking age old habits and bridging the urban-rural divide and most importantly dealing with the pricing pressure sensibly. The need is to balance the cost of acquiring users with that of latest innovation and the resource used to remain at par with modern demands.