For many, money is still sweeter than honey and moving this transaction material more virtually than physically is the need of the hour. Welcome to the world of contactless commerce and silent exchanges! The day is not far when liquid cash will no longer be used in inking deals and making negotiations across the table. The brand new freshly-minted crispy notes cannot be smelt and felt in hands before passing down to the receiver. Even stale, torn and tattered pieces of paper are seldom circulated nowadays. Money will be paid or gifts will be sent across only digitally. Let’s dig deeper into the domain of digital remittances.
Transact in Real Time
From shops to open markets, banks to offices, institutions to hospitals, railways to airports, terminuses to toll plazas and petrol pumps, smart devices are widely availed of to clear payments online through QR codes or in the UPI mode (Unified Payments Interface) on a real-time basis. One can easily pay monthly bills or quickly transfer money whenever and wherever required from an android phone via netbanking, e-wallet, apps and other payment gateways.
Notably, blockchains maintaining records of transactions in cryptocurrencies like Bitcoins still have a long way to go before winning acceptance by all and sundry, especially at administrative levels. Until then, digital dealings seem the safest route and the healthiest solution in the payment space.
Go Green: From Paper to Plastic to Contactless
Going paperless is no longer a choice but mandatory for many banks, merchants and customers in the payment ecosystem. With pollution taking a toll and global warming sending out warning signals each passing day, sustainable solutions become the only option for almost all industries to succeed in the long haul. The onset of the coronavirus pandemic has further fuelled the adoption rate of e-commerce and digital transactions for more than a couple of years now.
Globally, many payment aggregators are also partaking in the green initiatives to issue recycled or PVC debit-credit cards to preserve the planet. On the home front, touchless trade has been a key highlight of the Government of India’s agenda since its demonetization campaign back in 2016.
“Contactless payment options are becoming increasingly popular and will continue to grow in years to come. The virtual card market size is expected to see a CAGR of 10.5% from 2022 to 2028. The automation of accounts payable processes, specifically in the Small and Medium Businesses (SMBs), will be the key catalyst for virtual cards in the B2B (business to business) segment,” comments Hemant Vishnoi, co-founder, EnKash, Asia’s first and smartest spend management platform.
Digital Bharat
While the urban India hurtles towards the digitalisation wave at a breakneck speed, the scenario in rural Bharat may not reflect a similar picture. One of the players in this domain is Payworld Digital Services Pvt Ltd. “Our SmartPay wallet, equipped with an eKYC onboarding capability, allows our PayWorld Captains to provide a safe and convenient digital instrument for our customers to store their money,” informs Amit Tyagi, CEO of this Bharat-focused fintech platform.
Emergency Loans at Disposal
On more occasions than one, a person could be in urgent need of money. At this stage, India’s new-age digital lending platforms like Phocket springs up to offer young salaried professionals instant and affordable cash loans to meet their daily fund crunch.
Does the lending firm dispatch loans immediately with minimal paperwork and at low-interest rates through an app? “Absolutely! With AI technology, we process personal loans faster,” affirms the founder Piyush Jain. “The fully-automated method streamlines loan applications and reduces wait time and effort. It's a paperless process wherein KYC check happens via API verifications. We fetch bank statements from net banking. Users only need to register on the Phocket app,” he further sums up.
Strainer to Sift Fake From Legit
Security breach is one of the key aspects that online payment aggregators must consider to ensure transparency and confidentiality of the payer and the payee’s card details or their bank account credentials.
Wibmo, a wholly-owned subsidiary of PayU, is a leading provider of digital payment solutions and online payment processing services. Conversing about the authentication process in India to keep defaulters and fraudsters at bay, vice president Animesh Jha explains that “India's verification process predominantly depends on generating one-time passwords or MPIN (Mobile PIN) authentication. With the increasing penetration of smartphones among the Indian masses, banks and financial institutions are willing to move towards more consumer-friendly authentication methods, such as biometrics. As the region is a highly regulated market, most transactions must go through at least one filtering factor.”
Overseas Education
When it comes to academic matters, keeping the current annual budget in view, will the students studying abroad have to pay higher taxes (TCS) while clearing course fees through international remittances as funding comes from home? “The current-year budget categorically made a point that education abroad doesn't get costlier. The TCS (Tax collection at source) rate hike is largely intended to target high-value expenditures, such as payments towards tours, buying currency for travel, sending gifts or loans to relatives abroad, purchasing any property abroad or buying foreign stocks with an exception for medical treatment or education abroad,” notifies Rohit Gajbhiye, founder and MD of edu-fintech startup LEO1.
Manage Expense With Prudence
Digital expense management is no stranger to blue-chip companies and unicorn startups. But what about small and midsized business units? Are they consistently opening up to the trend of cashless trade? “Despite the Indian domestic market’s increasing IT adoption in the last decade, the awareness growth in MSMEs (Ministry of Micro, Small & Medium Enterprises) is at a nascent stage. The costliness of spend management solution also deters market growth,” states Avinash Godkhindi, MD and CEO, Zaggle, a profitable SaaS fintech company.
Build Cordial Relations With Corporate Gifting
In the realm of digital remittance, corporate gifting seems an efficacious strategy for MNCs. It has become an increasingly popular ploy over the years for multinational corporations in enhancing relationships with partners and customers. Phone Pe, Gpay, Paytm, Rupay, Bharat Pe, PayPal, RazorPay, BillDesk, etc. have been ruling the roost as frictionless real-time payment apps now.
Cross-Border Dealings
Recently, India and Singapore tied up to solidify their digital payment systems. India linked its UPI network with Singapore’s Pay Now, enabling immediate find transfers between the users of both countries at a reasonable charge. “Developments in the digital space are rapidly changing the dynamics of the digital payment industry leading to benefits like improved efficiency, convenience, transparency, easy access and reduced transfer prices,” says Mukesh Sahu, country manager, PingPong Payments, the world's second multi-platform cross-border payment service provider.
Impact on Tourism
Given the 2023 financial budget, travellers might be curious to know whether the tourism industry will be taxed higher and will this affect the bookings in travel agencies. “So far we have not seen any adverse impact due to budget-related announcements. We might need to wait for this summer season to clearly assess the impact,” notifies a reliable source from Yatra.com (hotel business).
