Mobile wallet firms see positive impact from new authentication rule in India
The removal of two-factor authentication for card transactions below Rs2,000 has made it easier for credit and debit card users, but digital wallets do not have much to worry from the change, industry executives and analysts said.
Removal of two-factor authentication simplifies and encourages electronic payments as the country battles a cash crunch after the withdrawal of high-value currency notes. Wallets need to be periodically refilled, unlike cards. The move will likely help cab aggregators, online movie ticket sellers and shopping portals, handling low-value, high-volume transactions where digital wallets are commonly used.
According to Vijay Shekhar Sharma, founder of One97 Communications that operates the Paytm digital wallet, removing two-factor authentication will not have any impact on wallet transactions. “It will accelerate adoption of card payments and will increase consumer convenience so that they use cards more often. Larger number of users will be able to do digital transactions after this.”