Viewpoint: How Mobile Wallets Fend Off Economic Shocks
By Surbhi Bhatia
Mobile-based payments gained sudden popularity within days after India’s decision to demonetize high-value currency notes in 2016. The transaction patterns in the following months are the subject of a new research, which has found that using mobile money can protect companies as well as families against economic shocks.
In a working paper for the International Monetary Fund, researchers Manasa Patnam and Weijia Yao study transactions on mobile wallet firm Paytm and link them with economic conditions. Satellite data on night-lights and government workforce estimates serve as proxies for economic activity, and rainfall data are considered as an indicator of economic shocks.
Photo courtesy of Jan Arendtsz.