Today is the second anniversary of demonetization, a policy decision of the Prime Minister Narednra Modi government's that severely impacted the Indian economy and small and medium businesses. But despite demonetization not achieving the intended task of wiping out black money, there has been a gradual rise of mobile wallet as one of the key payment methods for small transactions. E-Wallet companies like Paytm have flourished and cemented their position in mobile wallet segment, thanks to demonetization.
To understand the impact of Modi government's demonetization policy on e-Wallet in India, Velocity MR, a market research analysis company did a survey of about 2,455 people in cities like Delhi, Kolkata, Mumbai, Bangalore, Hyderabad Chennai, and Pune. The study indicates that there has been an improvement in the number of people using E-Wallets, particularly since the past 12 months.
Citing its survey, the research firm said that almost all of its respondents, about 97%, are aware of Paytm. A lower but similar level of awareness is there for Airtel money, Freecharge, and Mobikwik. “E-wallets are mostly used for mobile recharges (9 out of 10), followed by paying the utility bills (8 out of 10),” said the report.
The report also suggests that E-Wallets still haven't completely replaced the alternative methods of carrying out monetary transactions as many people still prefer using Debit or Credit cards or Internet banking among others as their preferred mode of payments.
“With an estimated 230 million smartphone users in India, improved internet speed and declining handset prices, mobiles have become the primary device shaping daily lives by changing how people search, purchase and pay for goods and services,” said Jasal Shah, Managing Director & CEO of Velocity MR.
For the growth of e-Wallet in India, he attributes it to the smartphone growth wave, the favourable regulatory environment from RBI and Modi government's demonetization push. “Mobile digital payments have increased rapidly post demonetization,” said Shah.