Jio MPoS, which will compete with existing players including SnapBizz, Nukkad Shops, and GoFrugal in the scattered MPoS market, will help kirana stores connect with its 4G network.
In its bid to create a dominant online-to-offline (O2O) e-commerce platform in the country, Reliance, which already has a network of over 10,000 Reliance Retail stores across India, is eyeing setting up of its Jio mobile point-of-sale (MPoS) devices at neighbourhood kirana stores. These stores make up for a majority part of India’s $700 billion retail market that is nearly 90 per cent unorganised.
Jio MPoS, which will compete with existing players including SnapBizz, Nukkad Shops, and GoFrugal in the scattered MPoS market, will help kirana stores connect with its 4G network, PTI reported citing a study by Bank of America Merrill Lynch.
Particularly with respect to cost for setting up MPoS device, Jio has kept it highly competitive at Rs 3,000 as a one-time investment in comparison to the one-time cost of Rs 50,000 (SnapBizz); Rs 30,000-55,000 (Nukkad Shops); and Rs 15,000-1 lakh (Go Frugal PoS software).
There is no merchant discount rate (MDR) on any charge by Jio MPoS and it offers a loyalty programme, the study said, adding that merchandise delivery, advertising and supply-side aggregation are included in the monetisation channels for Jio MPoS.
With the price point of Rs 3,000 for its MPoS device, Reliance Jio’s foray into the fragmented MPoS market is expected to “see an increase in merchant adaptability…and reach should expand,” the study said.
Bank of America Merrill Lynch also said that Reliance’s entry into the market could see consolidation even as it expected to boost the number of digitised retail stores to over 5 million by 2023 from current 15,000.
The urge to adopt the technology by kirana stores is driven by rising competition from e-commerce and modern trade even as the need to generate GST compliant bills has pushed the modernisation effort, the study said.
Most of the kirana stores believe the return on investment on MPoS is good as they liked the ease of generating GST compliant bills however they aren’t syncing their inventory in the PoS as either it was complicated for them to enter items in the software or they were hesitant to share data to PoS companies, Bank of America Merrill Lynch said.
The feedback on the usage of MPoS was recorded from 15 stores in Mumbai and Navi-Mumbai.