How the mobile payment solutions industry is shaping up keeping pace with the penetration of mobile users across India.
With the increase in percentage of mobile users, and smartphones making inroads in our lives, the mobile payment solutions industry has really taken off.
The mCommerce revolution
mCommerce is basically nothing but shopping and payments from the phone and mobile has become an ubiquitous device. It is in everybody's hands and the preferred medium that was laptops and notebooks has now moved to mobile. In the US, mobile application consumption has far exceeded desktop. In the next few years, it is going to catch up further. And laptops and notebooks will become outdated, unless you are in back office and doing some number crunching, you won't use laptops.
Market size of mobile payment industry
The market is huge. It runs into billions and billions of dollars because wherever there is a payment involved through any instrument whether be it cash, cheque, Internet banking, can be replaced by mobile payment system. There are 120 million mobile smartphone users. As per reports, India generates around 100 billion bills per year and top 20 cities contribute to 1/3 of this market. But when it comes to digital payment gateway, India still lags behind the mature markets due to unorganised market that dominates the retail space, unavailability of bank accounts etc. But it is expected that the industry will soon see huge leaps and bounds.
e-wallets & other payment modes
Some e-wallets are based on operators while others are agnostic of the operators. For example, Money-on-Mobile, a mobile payment solutions company, does not base its services to the operators. As per Krishna Lakamsani, Managing Director, iPayTech (I) Pvt. Ltd., payments are moving from physical cash to digital currency. In India especially, this is little far. People are not using m-wallets because here, there is no such lavish cash kept which people can think of spending later. If you load money into m-wallet, that money is stuck until you use it for future.
RBI- the regulator for "Semi-closed" payment system
The transaction between a registered merchant and a registered consumer is the crux of the semi-closed payment system, open looped payment systems are backed by the bank.
The Reserve Bank of India is actually the regulator for the semi-closed payment system in India. They are also concerned about moving cash out of the system and making all the transaction digital, hence, it is supporting mobile payment companies in a way they can.
Are consumers using mobile payment services?
Speaking at the session on "How consumers will pay in the future" at the Indian Retail and eRetail Congress and Awards 2015 hosted by Retailer Media, Shashank Joshi, Managing Director, Money-on-Mobile, said that currently, Money-on-Mobile is ranked among the top three with the volume it is processing.
Shortly, 215 of its retail outlets will start accepting mobile money, wherein you can buy bread, milk, eggs etc. straight from your phones.
Shedding light on the service and the industry prospective of the related business, he said that it's all about experiencing a quick, simple and efficient mobile payment solution. And Money-on-Mobile is a revolutionary concept aimed towards a service where you can pay mobile, DTH, utility bills and purchase goods etc at the click of a button.
Its business model- a semi-closed payment system, licensed by the Reserve Bank of India, here, transactions happen between a registered merchant and a registered consumer. The company has had a pleasant association with the Reserve Bank of India.
The future of mobile payment space
In the mobile payment space, the future lies in increasing the acceptability of mobile money as its acceptance as of now is very poor in India.
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