IDC Financial Insights predicts that by 2018, markets around the world will launch a national mobile payment scheme for POS, ecommerce, and ATM transactions.
India is predicted to be on this path, taking major steps to be among the first few countries to launch a nationwide mobile payment scheme.
Already next-generation payment structures, including mobile wallets, payments banks, BharatQR, and electronic authentication, have created new forms of digital payment channels and servicing capabilities.
“The payment industry in India is clearly going through gigantic changes. Over the last few years, the tremendous growth in the digital payment space has elicited a passionate debate across the industry, but one thing is certain, the next several years will see a transformation of how consumers, businesses, and the government move money,” said Anuj Agrawal (photo right), Senior Research Manager, IDC Financial Insights.
Usage (number of transactions) of digital payment instruments has seen a tremendous improvement year over year versus traditional non-digital channels (excluding cash).
The contribution of digital payment instruments (such as retail electronic clearing, mWallet, and mobile banking) means the volume of transactions has already doubled in 2016-17 and is expected to grow further by the end of fiscal year 17-18, from 32% in 2013-14 to 62% in 2017-18 (estimate).
UBS AG’s director, Equity Analyst, Sundeep Gantori, says around the world online payments is gaining market share against traditional payment networks and traditional banking channels.
Beyond payments, interest in Fintech startups in areas like blockchain, artificial intelligence and e-commerce lending, are just some of the focus areas of these more nimble organizations, added Gantori.
He cautioned while there are significant activities in these other areas, including investments, the actual revenue impact could be limited in the near term.