When India was facing the issue of currency change, at that time, mobile payment arrives and moonwalks in as the ‘Savior.’ Back then, it could go by something that is the ‘latest wrinkle’, however, as of now, it is justifiably a trend!
According to eMarketer, this trend has hit India really hard, making the country the world’s fastest-growing “proximity mobile payment” market, globally. This fancy term refers to scanning, tapping, or checking in with any cellular device at some specific point of the scale. eMarketer statistics suggest that this year, 73.9 million people in India – that account to be 7.6% of the whole population of the region – will use mobile payments. That is a dramatic increase of 39.7% compared to last year.
To lure 337 million active smartphone users in India, improved internet speed and declining handset prices have been at large, making mobile phones one primary device. These devices are pretty much useful and handy, altering the way customers search or purchase goods.
Beside the driver’s seat is the laid-back, relaxed service of online payments that has been driven well by smartphone growth and favourable regulatory environments. The ease of incorporating the use of mobile payments in daily lives have significantly pushed the economic spectrum of the country towards a cashless space.
Bolstering the Much Needed Change!
India’s smartphone penetration is only at 26% of the population for 2018, but the number of smartphone users is expected to balloon to almost 500 million by 2022. As the country becomes more and more connected, one of the main apps smartphone users in India are adding is one with these payment capabilities. – Showmik Podder, junior forecasting analyst at eMarketer.
The biggest out of the many big-wig contributors towards this wide adoption of mobile payments in India has undoubtedly been demonetization of cash notes back in November 2016. Taking out oodles of cash, out of circulation had forced merchants and consumers to look for methods of adopting digital payments and this, in turn, has accelerated the growth of mobile payment. Companies like Paytm with aggressive campaigns “Paytm Karo” helped it to soar up in mobile wallet space in India.
In September 2017, tech-giant Google’s mobile payment solution Tez allowed Indian users to link their phones to their bank accounts, as well as, phone to phone money transfers. Before Tez, back in March 2017, Samsung Pay too entered the Indian landscape which later was restricted to offline payments. While many payment wallets marked their entry into India, in the past few years, Paytm continues to dominate the mobile payment market.
In Oct 2017, government approval on Interoperability made mobile wallet ecosystem much simplified. Furthermore, the approval of Pre Paid Instruments licenses by RBI has bolstered the establishment of mobile wallets in the Indian landscape.
However, this was accompanied by additional cons too. Reduction of withdrawal limits to INR 10,000 and mandating KYC had some negative impact on the overall growth.
How Vast Is the Mobile Payments Scape In India?
To understand how big mobile payment in India is, we need to keep tabs on the current stats of mobile payment solutions and the rate of growth throughout these past years.
India is considered to be the second largest, untapped market in the world, with over 1 billion mobile subscribers base, as of July 2018.
A study of Digital Payment Systems Market in India conducted by Orbis Research depicted that the Indian digital payments industry is forecasted to reach $700 billion by the year 2022, in terms of transactions. Additionally, it was expected that more than 80% of urban India will adopt digital payments as an integral part of their daily lives by 2022, and retail shops will follow suit, at an increased adoption rate of 70%.
With more mobile wallets than cash or credit cards, mobile payments have certainly evolved as the key solution for many customer problems. Now with efforts from government and new innovations, mobile wallets are expected to grow further, and certainly, the trend is not fading any sooner!