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Nasdaq-listed global payments company PayPal does not see Modi-led government’s demonetisation move adversely impacting the ‘Incredible India’ story among foreign tourists, a top official of its Indian unit said.
The move has created a “behaviour shift” among local merchants who have been catering to foreign tourists, and there is now increased demand and interest for accepting PayPal (digital payments) among these merchants,
“We now are receiving lot of requests from merchants, who earlier were not open to accepting digital payments, and who now believe that accepting digital payments is the need of the hour,” Megha Tyagi, Director - Large Merchants, PayPal Payments, told BusinessLine here.
Many merchants are now realising that if they don’t want to pull their shutters down, they need to have digital ways for accepting money, she added. Increased interest is mainly from travel merchants and fashion-related service providers.
Tyagi said PayPal in India is “working closely across the spectrum of merchants that we believe touch foreign tourists’ lifestyle when they visit India, and solve for those problems (payment related).”
She felt the recent demonetisation move would not impact the rich tourists visiting India, but noted that the tourists who come to explore ‘Incredible India’ seem to be mostly impacted by the development.
For small spends, the visiting tourists could use local currency — ₹5,000 as allowed by the government. But for large spends such as domestic air travel and hotels, they have to rely on PayPal-like solutions.
Post the demonetisation announcement on November 8, several countries had issued advisories to their citizens, warning them about possibility of cash crunch situations in India.
The winter months of November and December traditionally sees significant arrivals of foreign tourists. In 2015, nearly 1.7 million foreign tourists — significant proportion of the annual 8 million annual who visited India in 2015 — visited India in these two months.
Tyagi noted that India presents an exciting opportunity for PayPal. “As part of our global expansion, we look at India as a very important market. The demonetisation move is masterstroke and as a brand, we support demonetisation. The timing is interesting as we have favourable demographic population and the government has created a strong infrastructure — you have UPI, Aadhaar, Jandhan. The only thing that was required was mindset change.”
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