Mobile plastic

TRAVEL: The prepaid cash card concept seems to have caught the fancy of online travel customers.

Going by the Internet and Mobile Association of India, the 38.5 million Indians online today are expected to grow to 100 million by 2007-08 and the online travel market is expected to exceed $2 billion. And with only an estimated 20 per cent having credit cards and not all of them comfortable using them online, a new option might be just what you need.

The alternate: cash cards in denominations up to Rs 10,000 that can be bought from the market and used for transact ions on select websites to book your rail, air tickets, hotel rooms as well as travel packages.

"It's doing good business," says Naveen Surya, director, ITZ Cash Cards. "There are 50 million users using various denominations of the card," he says. ITZ Cash is the largest cash card player in the market today. Done Cash Cards has sold just 2.5-3 million cash cards.

Makemytrip.com is offering the option of using ITZ Cash Cards. Sachin Bhatia, chief marketing officer, feels doing so would help it reach out to a newer audience.

"A true alternative for cash should be one easily available to the masses with no lengthy application processes and with immense usage opportunity," says Surya.

IRCTC has integrated all the three cash card players "" ITZ Cash, Done Cash Cards and Icash Card "" on its website and sees about Rs 4 crore (40,000 tickets) worth of transactions a month through cash cards (Rs 3 crore/month with ITZ Cash alone). This is less than 7 per cent of its total sales in December 2006 (Rs 60 crore).

For Yatra, transactions have increased since it integrated ITZ Cash Cards on its website. Yatra co-founder Dhruv Shringi says in just a few months cash card transactions are up 4-5 per cent. "Their transactions usually hover around Rs 2,500-3,000.

Ashwin Damera, CEO, travelguru.com, informs that 10-15 per cent of its customers pay manually into a bank account (specified by travelguru.com). "We don't know how big it will be once we launch but it will surely widen our addressable audience," says Damera.

The only barrier is the transaction cost. "If that comes down, we will want to promote it even more aggressively," Damera says. Bhatia of makemytrip says the transaction cost payable is negotiated depending on volumes generated.

Subhash Jewria, CEO, Done Cash Cards, has a different strategy. He is targetting rural areas where credit card penetration is low: "We tie-up with our distributors, who in some cases are cybercafes that help locals transact over the Internet."

They have already launched in rural areas of Gujarat, Maharashtra, Madhya Pradesh, Uttar Pradesh, Bihar and also in Delhi and Bangalore.

And travel isn't all: the cash card can also be used for shopping online on websites such as rediff.com, Asian Sky Shop, and even pay your phone and electricity bills. How's that for plastic cash revolution?