Mobile wallets such as Paytm, MobiKwik, PayU and FreeCharge expect that the number of merchants accepting transaction through their digital platform will rise manifold now that the Reserve Bank of India has doubled the monthly ceiling beyond which they cannot operate.
Mobile wallets such as Paytm, MobiKwik, PayU and FreeCharge expect that the number of merchants accepting transaction through their digital platform will rise manifold now that the Reserve Bank of India has doubled the monthly ceiling beyond which they cannot operate. On Tuesday, RBI enhanced the issuance limit for pre-paid payment instruments to R20,000 per month from R10,000 for users and upto R50,000 for merchant bank transfers.
Following the demonetisation of R500 and R1,000 notes on November 8, mobile wallets have been clocking more than 10 times growth in merchants as more consumers are turning to digital payments, therefore revising upward the threshold level was seen as natural.
MobiKwik registered a 150% jump in the number of merchant to 2,50,000 from 1,00,000, prior to demonetisation. It said that it will hire over 12,000 agents to expand offline merchant network to over 10 lakh touch-points by the end of the current fiscal.
Vijay Shekhar Sharma, founder and CEO of Paytm said his team is aggressively monitoring small merchants and advising them accordingly to expand their base. Since January it has added 15 lakh merchants on the platform but the new initiatives will aid the growth and the company is expected to have 1.5 crore merchants listed on its platform by November 27.
To increase the adoption of digital payments, mobile wallet users can upload up to R20,000 per month without KYC. User are also allowed to maintain balance amount limit up to R1 lakh if their mobile wallet account is KYC compliant.
For Paytm the pace of transactions has increased from 3-4 transactions in a week to 4 transactions in a day, according to Sharma. The average transaction value has gone down but the number of transactions has increased as users are adopting digital mode of payment for daily essentials such as food, grocery, utility services and other household requirements.
“Since this (demonetisation) announcement our transactions have dramatically increased to over 90%. While our average daily transactions amount to R12 lakh, we are anticipating the same to increase by R25 lakh in the upcoming months,” said B Amrish Rau, CEO of PayU India.
MobiKwik has revised its monthly annualised gross merchandise value sales target by 10 times to $10 billion by 2017.
According to the notice, the merchant must give a self-declaration and submit their bank account details and after verification and validation of the bank details they can become a merchant on platform. Under special measures for merchants announced by RBI, the merchants can transfer up to R50,000 per month from the PPI to their linked bank account.
Paytm claims to be the largest player among other mobile wallets and said that it will be signing-up 70,000 merchants daily from 40,000 merchants earlier. Paytm also launched an app-based POS on its mobile app that will allow merchants to accept payment using their QR code as a POS machine.