Money & Banking

M-wallet transactions set to soar as more people move to cashless mode: Study

Our Bureau Hyderabad | Updated on January 16, 2018 Published on December 29, 2016


To touch 26,000 cr in 2022, up from 50 crore at present

Demonetisation of ₹500 and ₹1,000 notes has pushed people to look at cashless options for payments. The industry expects the share of mobile wallets in the total mobile payment volume of transactions to go up to 57 per cent by 2020, from 20 per cent this year.

M-wallet transactions are likely to grow at a compounded annual growth rate (CAGR) of over 160 per cent from just over 50 crore in FY16 to 26,000 crore by 2022, driven by growing usage of smartphones, mobile Internet penetration and growth of e-commerce sector. It is expected that the market value of m-wallet transactions in the country will grow at a CAGR of over 200 per cent to ₹275 lakh crore by 2022 from ₹20,600 crore this financial year, according to a study jointly conducted by Assocham and RNCOS Business Consultancy Services.

“m-wallet transactions have grown about 20 times to reach ₹20,600 crore in 2016 from ₹1,000 crore in 2013,” it pointed out.

“The government has hinted of not remonetising all of the scrapped currency and aims to fill the gap by promoting the digital or cashless payment mode. This is bound to further boost prospects of the m-wallet sector in India,” DS Rawat, Secretary-General of Assocham, has said.

Releasing the report here, Rawat said the average wallet spend in the retail sector had gone up after demonetisation. The study acknowledges that the non-cash payment transaction system is still at a nascent stage in the country.

“Majority of the retailers do not have PoS (point-of-sale) devices to offer card-based payments. They are reluctant about non-cash payments,” the study said.

The study, however, said that there was a need to put in place a strong authentication mechanism to bind the identity of the user to the authorisation of the transaction.

“As the mobile payment space evolves, the stakeholders must create secure transactions that foster consumer trust. Besides, m-wallet companies must provide a much more secure payment authentication process out to the masses,” the study said.

Published on December 29, 2016
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