E-Wallets catching on in India
Monday, January 12, 2015
In a rush to board a train in time, Shivani Bhargava, a 19-year-old Delhi University student from Mumbai, ends up in a tight spot after she forgets her wallet at home. After getting down at the station in Delhi, she has to book a cab and reach her hostel at the earliest, but doesn’t have the cash or cards to do so. Enter Meru Cabs’ ‘cab wallet’. All she does is tap her mobile app and, voila, the payment is made. “Not only did I reach my hostel safely, but I also got a 30% discount,” says Bhargava.
Meanwhile, a couple of hundred kilometres away, 33-year-old Pappu, a plumber from Jaipur, has stopped queuing up at the post office to send money back home in Bihar. These days, he transfers it straight to his wife’s account through his smartphone. Back home, his wife Beena, too, doesn’t have to travel for miles any more to withdraw the money; a trip to the neighbourhood kirana (grocery) store suffices.
Several companies, especially those in the e-commerce and telecommunication services sector, have come out with digital wallets to help consumers. All you need to do is preload money and you can use it to pay for services or transfer it to other accounts. If a recent Reserve Bank of India (RBI) directive is anything to go by, these digital wallets can soon apply to become ‘payment banks’, financial institutions aimed at “furthering financial inclusion”.
As per the directive, telecom operators, supermarket chains, electronic wallets and prepaid instrument players can open these payment banks to accept deposits, offer basic saving facilities and provide remittance services for millions of people who are currently out of the digital financial system.