Investorideas.com
Search  Follow Investorideas on Twitter  Investorideas is on Facebook  Investorideas is on Google Plus  Investorideas is on Youtube  Investorideas is on Pinterest  Investorideas is on tumblr  Investorideas is on LinkedIn  Investorideas RSS 


Investorideas podcasts on iTunes, Google Play Music and iHeart.com    Bitcoin and Blockchain Stocks    Play by Play – the latest sports headlines and sports stock news

 

Join Investor Ideas Members to access the Renewable Energy stocks directory, water stocks, biotech stocks, defense stocks directories and the Insiders Corner

Mobile wallet is gradually displacing cash in India, says GlobalData

 

February 22, 2018 (Investorideas.com Newswire) The mobile wallet market in India is poised for significant growth as Indian consumers are increasingly turning away from cash and card, says leading data and analytics company GlobalData. According to the 2017 Consumer Payments Insight Survey by the company, India is one of the top markets globally in terms of mobile wallet adoption with 55.4% survey respondents indicating that they have a mobile wallet and use it. India is followed by China and Denmark.

The adoption level in India is much higher compared to many of the developed markets such as the US and the UK, where consumers predominantly use cards. Mobile wallet transactions grew manifold in last five years, rising from INR24bn in 2013 to INR955bn in 2017, and will surpass INR1tn mark in early 2018.

Ravi Sharma, senior analyst at GlobalData's Payments practice, comments: "The growth in mobile wallet market is fueled by the government's policies to promote electronic payments, coupled with rise in smartphone penetration, and improved telecom and payment infrastructure."

The government's demonetization move in November 2016 was a game-changer as it had led to a massive cash-crunch in the country as most of the ATMs dried up, compelling people to switch to electronic-mode of payments. While medium to large-value transactions continue to be made through digital banking channels, the low-value day-to-day transactions are carried out through mobile wallets.

The total value of mobile wallet transactions grew two-and-half times between 2016 and 2017. Initially considered as e-commerce payment tool, post demonetization, these wallets are now widely used for day-to-day transactions at supermarkets, grocery stores, street vendors, tea stalls, fuel stations, and even inside taxis and auto-rickshaws.

IMAGE FOR PUBLICATION, Please click here: 'Mobile wallet in India'

Mobile wallet has become a mainstream payment instrument in India. GlobalData's survey shows that the share of cash or cheque (cash on delivery) in total e-commerce transaction value declined from 31% in 2013 to 16% in 2017, whereas the mobile wallet share jumped from just 7% to 29% during the same period. The usage of payment cards dropped from 38% to 32% during this period.

IMAGE FOR PUBLICATION, Please click here: 'E-commerce transaction value by payment tool (%), 2013 and 2017'

While consumers have benefited from convenient payment option and pricing benefits (cashback/discounts), it is the 'cost-effectiveness' that appeals to the merchants as the cost associated with mobile wallet acceptance including setting-up infrastructure and transaction fees is much lower compared to traditional card-based payment system.

Paytm, for instance, does not charge merchant any fees towards installation and annual maintenance. While it charges merchant service charges for online payments, no charges are applied on QR code based in-store transactions.

With intensifying competition in the Indian mobile wallet market, payment service providers (PSPs), banks, mobile network operators, and the government are all gearing up to get a piece of the mobile wallet pie. The significant growth in the market has led to the mushrooming of mobile wallet operators.

More recently, in September 2017, tech-giant Google launched its mobile payment solution–Tez–in India that enables users to link up their phones to their bank accounts to pay for goods in physical stores and online, as well as for P2P money transfers. Earlier, in March 2017, Samsung Pay entered the Indian market, though its use is now restricted to only offline payments.

While many payment solutions have forayed in the past few years, Paytm dominates the mobile wallet market and accounted for 9.9% share in total e-commerce transaction value in 2017, closely followed by PayPal with a 9.8% share. Other popular mobile wallets are MobiKwik and FreeCharge, which accounted for 2.8% and 2.7% of total e-commerce transaction value respectively.

To remain competitive, wallet providers are now looking beyond 'just payments' and focusing on value-added services. These wallets encompass additional services such as utility bill payments, mobile top-up, hotel/airlines bookings, buy entertainment tickets, and even gold purchases. Some of the wallet providers such as Paytm and Airtel have begun to move to other sectors to offer banking services, after receiving the approval from RBI.

Sharma concludes: "The provision of banking and value-added services is likely to further drive number of transactions via mobile wallet over the next five years."

For more information

Analysts available for comment. Please contact the GlobalData Press Office:
Asia-Pacific: +91 40 6616 6809
EMEA & Americas: +44 (0)207 832 4399
Email: pr@globaldata.com

To gain access to our latest press releases and expert analysis on developments in your industry, please connect with us on: GlobalData.com | LinkedIn | Facebook | Twitter

About GlobalData

4,000 of the world's largest companies, including over 70% of FTSE 100 and 60% of Fortune 100 companies, make more timely and better business decisions thanks to GlobalData's unique data, expert analysis and innovative solutions, all in one platform. GlobalData's mission is to help our clients decode the future to be more successful and innovative across a range of industries, including the healthcare, consumer, retail, financial, technology and professional services sectors.

More Info:

Investorideas.com Newswire

This news is published on the Investorideas.com Newswire - a global digital news source for investors and business leaders

Disclaimer/Disclosure: Investorideas.com is a digital publisher of third party sourced news, articles and equity research as well as creates original content, including video, interviews and articles. Original content created by investorideas is protected by copyright laws other than syndication rights. Our site does not make recommendations for purchases or sale of stocks, services or products. Nothing on our sites should be construed as an offer or solicitation to buy or sell products or securities. All investment involves risk and possible loss of investment. This site is currently compensated for news publication and distribution, social media and marketing, content creation and more. Contact each company directly regarding content and press release questions. Disclosure is posted for each compensated news release, content published /created if required but otherwise the news was not compensated for and was published for the sole interest of our readers and followers. More disclaimer info: http://www.investorideas.com/About/Disclaimer.asp Learn more about publishing your news release on the Investorideas.com newswire http://www.investorideas.com/News-Upload/

Additional info regarding BC Residents and global Investors: Effective September 15 2008 - all BC investors should review all OTC and Pink sheet listed companies for adherence in new disclosure filings and filing appropriate documents with Sedar. Read for more info: http://www.bcsc.bc.ca/release.aspx?id=6894. Global investors must adhere to regulations of each country.