Global payments technology firm Visa is betting big on innovations such as QR technology and contactless cards to drive digital payments in India. The company also believes that the recent implementation of GST will drive adoption of digital payments among small- and medium-sized merchants.

TR Ramachandran, Group Country Manager, India and South Asia, Visa, said: “India represents perhaps the single-largest cash displacement opportunity. There has been a significant increase in digital payments penetration post-demonetisation. It’s fair to say that post-demonetisation, India has perhaps leapfrogged 3-4 years and achieved what otherwise could have been achieved only by 2020.”

He said that post-demonetisation, the company is seeing a shift towards digital payments even in non-discretionary categories such as fuel, groceries and bill payments at small restaurants, even in tier II and tier III geographies. He was addressing reporters at a press meet at Visa’s Global Innovation Centre in Singapore.

Over the past two years, the company has been introducing several innovations and working with partners to get consumers and merchants to shift to digital payments. For instance, Visa pioneered the QR technology as a low-cost payments solution in the country and subsequently, worked with other stakeholders to introduce BharatQR.

Ramachandran said: “The low-cost QR solution has the potential to rapshift consumers and merchants from cash to digital payments rapidly. Currently, just about 2.5 million merchants have adopted this. Given the size of the country, we have not even scratched the surface.”

Towards digital payments The company also believes that the recent implementation of GST and appetite for credit through formal financial channels will drive the adoption of digital payments, especially among small merchants. He said adoption of digital payments by government bodies will be also be very critical.

“If we have to compete with cash, we have to make digital payments more convenient and frictionless. Contactless cards make digital transactions quicker. Given the trends, I believe in the next 12-18 months, we will see a rapid proliferation of these cards in the country,” he said.

Securing data With the growing adoption of wearable and smart devices, the payments technology company believes its tokenisation system will pave the future for e-commerce and m-commerce transactions.

Tokenisation replaces traditional card account number with a unique digital identifier to process online payments without exposing actual account details. “Tokenisation will perhaps be the foundation of how payments will be done in the next decade. We believe over the next five years, there will be rapid adoption of IoT (Internet of Things) devices in India. We are pressing the pedal hard in propagating this system. With consumers set to use multiple connected devices for making their purchases, tokenisation will be critical in making digital payments secure by devaluing sensitive consumer data.”

So what’s in store for the future? From integrating Visa account with advanced auto technologies to enabling on-the-go and in-car payments, to developing concepts that seamlessly integrate digital payments with offline shopping, the company is fine-tuning several innovations.

(The author was in Singapore at the invitation of Visa)

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