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The Rise & Rise Of Digital Payments
India is at an inflection point of a systemic change and the Covid19 crisis provided an impetus to test the reliability of the systematised settlements system in India.
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Economies of countries have been reeling under the shock of an unprecedented crisis.
Covid-19 crisis has challenged the adaptability quotient of nations, catalysed innovation, improvisation and experimentation in this fast paced VUCA (volatility, uncertainty, complexity and ambiguity) world. India has displayed extraordinary preparedness and is emerging as a global leader in the dynamic payments space. Under the ‘Digital India’ campaign, the government has pushed to improve digital literacy which in turn had a significant impact in improving the overall digital maturity of the Indian populace.
Pre-Covid, the Indian digital landscape was exploding. With the total number of transactions on unified payments interface (UPI) clocking a record high 1 billion in October 2019. The recent UPI data elucidates that there has been approximately a 24 per cent increase in transaction volumes between April and May 2020, where total transaction numbers stand at 1.23 billion.
During the lockdown, even though consumer’s discretionary spends were at an all-time low, there has been an increased adoption of digital payments. Categories under person to merchant (P2M) transactions such as supermarkets, medical stores, recharges and bills showed promising growth.
India is at an inflection point of a systemic change and the Covid19 crisis provided an impetus to test the reliability of the systematised settlements system in India. This distinct shift in consumer behaviour, owing to Covid19, is the keystone based on which the entire transaction poised for a revolution. We have seen that previous financial crises and pandemics have helped spur innovation and push reforms that enabled the penetration of technology. There is a slew of emerging trends and enablers in this context.
Online Collaboration Tools: Collaboration tools have identified the right mix of online collaboration tools for employees and their stakeholders to work and collaborate remotely.
Marketing Strategy: Covid-19 has made marketers understand the importance of raising awareness and educating audience about their offers.
Business Continuity As New Norm: Most organisations have developed business continuity planning (BCP) automation practice and new policy indicates the frequent drill which might prove effective during the Covid-19 crisis and in future as well.
Emerging Technologies: Organisations which are still thinking over the idea of migrating to cloud, use open application programming interface (APIs) platforms etc. has expedited projects and usage of data has become an intrinsic part of product or service design.
Resilient Information Security: Reports suggest a surge in security breaches due to a substantial increase in working remotely. This indicates the need of resilient, robust and advance security systems in an organisation to protect from systemic vulnerabilities.
As a country, our resilient diverse population has always been receptive to change. During its nascent stage, digitisation was considered a comfort, not convenience. Whereas today, India is being lauded for pioneering an attempt to create a robust, developed, low cost, secure, integrated payments and settlement systems.
The introduction of UPI in 2016 marked the inception of the first milestone towards realising the RBI’s 2018 vision of a ‘less cash’ and ‘more digital’ society with increased financial inclusivity. It is important to recognise regulator’s support to push digital transformation in the last few years and this trend will continue in the future as well. From a country that was entirely cash driven, there has been a gradual reconstruction of the cash economy with the growing usage of digital payments.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.