The acute shortage of cash following demonetisation has seen greater use of payment apps at both banks and standalone wallets, reports Hita Gupta in New Delhi.
The acute shortage of cash following demonetisation has seen greater use of payment apps at both banks and standalone wallets, reports Hita Gupta in New Delhi. A study by Morgan Stanley shows daily download activity has increased anywhere between 1.7 times and 4.6 times compared with average
levels seen before the old high-value currency notes of R1,000 and R500 denomination ceased to be legal tender on November 8. Among those players that have been seen the highest downloads are State Bank of India and Paytm.
For Paytm the daily run rate increased to 1,90,000 between November 8 and December 5 from 45,000 earlier, while for SBI it went up to 1,07,000 from the earlier 23,000. Morgan Stanley has said that after December 5, download activity has further increased. Given transactions in India are predominantly cash-based, there is enormous scope for digital payments.
According to Euromonitor, 78% of total consumer payments in India in 2015 were done in cash versus 47% for China and 24% for the US. If India’s cash consumer payment activity were to decline to 61% (where China was in 2010), digital payments in the country could grow to $470 billion by 2020 from $190 billion in 2015, the report has noted.