Demonetisation has made smartphone mightier than the wallets that holds cash and cards in your pocket. And today there are a range of e-options available leaving the consumer confused on the best way to pay.
Should it be credit cards, net banking, united payment interface, NEFT, RTGS, IMKPS, USSD, Aadhar-Linked BHIM or combination of all these. So far, people have grabbed whatever was available especially the m-wallets have taken off very well post demonetisation. But in due course, people will opt for an easier digital platform.
Experts say that frictionless payments are the future. Three things are going to be important for any payment option: access, interoperability and financial sustainability of the operators.
M-Wallets: Popular digital payment mode via smartphones, enable easy payments to vendors with cash back option being there. Such wallets include: SBI Buddy, HDFC Payzapp, Mobikwick. In all, around 40 entities have licences but of those, 20 are operational. In this mode interoperability is a challenge. It requires company to company transfer. For instance, Paytm to Paytm, Mobikwick to Mobikwick and Freecharge to Freecharge. There is definitely a restriction to these wallets and these wallets need to evolve to become more interoperable.
NEFT and RTGS: National Electronic Fund Transfer(NEFT) and Real Time Gross Settlement help one-to-one and business to business fund transfers. Both operate during banking hours. Immediate payment service (IMPs) A real time electronic funds transfer system using mobile phones. It is 24x7 service, 365 days.
Plastic Money:750 million cards in circulation but less than 400 million are used. Most of the merchants insist on a transaction fee of anywhere between 2 per cent to 20 per cent.
Mobile Banking: Access and operate your bank account via the banks app or browser.
Unified Payment Interface (UPI): Interconnects banks to help transfer funds. Both the sender and receiver need a UPI identity. Already 30 banks offer this.
Aadhar enabled transfer systems: Complete systems using biometric authentication.
BHIM: UPI based service to enable money transfer using just a mobile number.