 "Here's how demonetisation is shaping up cashless ecosytem")
Ever since the government announced demonetisation of Rs 500, Rs 1,000 notes, life of Indian citizens hasn't been the same. The severe cash crunch after 86% of currency was taken out of circulation has pushed people towards cashless transactions. Transactions through mobile wallets, debit and credit card, and net banking hit record heights. This could be shaping new ecosystem towards cashless economy.
Hike messenger founder Kavin Bharti Mittal in an interview with Economic Times revealed plan to include payment services in the chat platform. Hike has over 100 million users and it is important to note that, in August, Hike raised $175 million in a funding round led by Tencent & Foxconn. The hugely popular Chinese cross-platform instant messaging service WeChat was developed by Tencent. It has over 700 million active users and allows user to make peer-to-peer transfer and electronic bill payments, online purchases, ticket bookings, and fixing appointment with doctors. So one can expect Tencent to help Hike build a similar platform.
At this difficult time, startups that are prominent in urban areas have extended help in many ways to ease the pain. How the startups are responding now will give an idea about the future roadmap of online payment with changing circumstances. Ola on Wednesday launched a credit feature that lets commuters take a ride now, but can pay only after seven days. At the end of the seven-day period, customers can pay their bills via net banking, debit or credit cards, or through Ola Money wallet.
FreshToHome, an online platforms that delivers fresh meat, is allowing their customers to pay by IOU, an informal document acknowledging debt, up to Rs 600, if you can't pay by cash or net banking. Yourstory reported that fashion e-commerce platform StyleCracker is extending a two-week credit period to their customers. Brands like Ginil&Disha, Amoh by Jade, Pause, Spring Break, Rashmi Modi, Nestaah, Surbhi Shah-Jaipur, Oceedee, and many more which lists their products on StyleCracker have agreed to extend this credit service.
Besides e-commerce, bill payments, recharges, even the online lending space is slowly shaping up to fill the credit gap in informal sector. It is now going beyond just peer-to-peer lending. Healthcare startup Practo, which offers services like doctor appointment and practice management software, is planning to tie up with NBFC to provide financial assistance to its users, according to Economic Times report. The report said that the move is to help doctors carry out their expansion plan like buying new medical equipment and give loans to patients.
Despite all this for a country where internet penetration is very low, cash payment will continue till the time connectivity issue is resolved and the companies have to adapt to this changing environment. When most of the e-commerce sites are urging their customers to pay online and more so after the demonetisation, MakeMyTrip in a surprising move is planning to allow its customers to pay an advance and the remaining amount in cash for some purchase of flight tickets and hotel packages in coming months, according to an Economic Times report.
The travel company is also working on its desktop site to improve customer experience. The report said that the reasoning behind the move is not many customers are comfortable in conducting high value transaction online. The move will be useful for people who look to buy a ticket but don't have sufficient balance in their account at the time of booking.
READ OUR FULL COVERAGE ON THE MODI GOVT'S DEMONETISATION MOVE
READ OUR FULL COVERAGE ON THE MODI GOVT'S DEMONETISATION MOVE