Everything you need to know about desi digital wallets

Digital wallets are evolving and adding a host of new features. Find out how this war of wallets is going to benefit the end user

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‘Money makes the world go round’. This popular saying has now translated into reality, virtually!

Digital wallets have entered the Indian market with a bang and they are here to stay. All you need is an internet connection and click - there goes your hard earned money! Shopping online just keeps getting easier. Digital wallets are electronic mediums which empower the user with the ability to make e-commerce purchases. After PayPal in America, our very own desi digital wallets are pushing boundaries to carve their own niche and tap into new users. Let’s take a look at a few of the emerging trends adopted by these wallets to garner more users.

Exclusivity
We are in a relationship and yes we are exclusive

Payment to chains like Big Bazaar, or booking of railway tickets on IRCTC are possible only on MobiKwik. Their exclusivity attracts new customers.

MobiKwik’s exclusive tie-ups with BizBazaar and also facilitates IRCTC

Integrating Platforms
Two halves form a whole

“Power Wallet” by MobiKwik integrates the online payment platform of retailers with that of the mobile wallet firm. Double blessing! Suits your convenience and the merchant’s purpose.

Limitless payments and increasing limits
There is no need to draw a line

Paytm plans on digital verification synced with Aadhar. Payments will then be possible for every and any kind of service in the digital spectrum. With full KYC (Know your customer), the digital wallet limit can be extended from Rs. 10,000 to Rs. 1 lakh. Both, PayTM and MobiKwik are working towards KYC.

Merchant network and market penetration
Uncle please send us 2 litres of milk and 2 kilos of onion

By tying up with local stores and kirana shops, the apps are reaching out to all sections of society. In the process, they are also building a strong network of merchants.

In order to further increase its merchant network and market penetration, Paytm has also been aggressively targeting the single screen theatres to bring them onto their platform to boost their ticket bookings, especially in the urban areas. Several Uber and Ola drivers also accept money transfers to their personal wallet accounts directly, such as Paytm. Recently, bus counters operated by state transport undertakings like Uttarakhand and Rajasthan have also started accepting money via Paytm using Paytm QR Code.

App point
“But mom see! I’m collecting points and soon I will buy you something for free!”

Just as you get points for a purchase in a store, wallets have started offering points which can be used to make payments for any service/commodity. (Oxigen reward points)

Oxigen Wallet Brand Tie-ups and reward points

Benefits over credit and debit cards
“Why use plastic when you can go green digitally”

Making payments via digital wallets are incentivised by offering the benefits that are provided by credit/debit cards - Cashback, discounts, etc. (PayUMoney offers 5-10% discounts on almost all services).

Value added services to customers
“Catches the eye and pushes the finger”

In addition to the discounts, wallets are offering several promos and coupons. If you use OlaMoney to make any payment, you may get a coupon for any of the hotels/restaurants affiliated with the digital wallet. Paytm calls them the “Big savings offers”.
Eg: Giftcards by Amazon, a pre-paid instrument.

Paytm's 'Har Din Lakhpati' offer

Sharing Money
“Because sharing is caring”

Apps like Oxigen allow you to share money with friends and family over various social media networking sites like Whatsapp, Google+, etc. This comes as a blessing in disguise as you will no longer be stranded if you forgot your wallet at home. All you need to do is - keep your wallet close, but keep your friends closer!

Emergence of mini-banking institutions
“Carry your bank in your phone”

Digital wallets will become even more attractive to the customers in the future because of it’s banking like functions. Remittances in developing countries are likely to grow. Some financial institutions already have their own wallets - SBI Buddy and ICICI Pocket.

Emphasising on the safety proposition
“Trust is the foundation of any relationship”

As trust is the virtue that can make/break a customer’s financial dealings, wallets are investing in several security measures to rope in new customers. While making payments via digital wallets, a password is required for the auto-fill form. This feature therefore keeps unauthorised users away from personal information stored on devices. The user’s credentials are passed on via SSL (Secure Socket Layer) encryption. Authentication of the holder’s credentials is also possible using these wallets. A holder’s driving license or any such identification can be stored on his/her device which can be transferred to the merchant using near field communication providing proof of identity and age.

Range of services
“Gourmet Buffet with cuisines from around the world”

From paying bills to online shopping, wallets are expanding their reach by including services by the day. Paytm offers a facility of “Income Tax E filing” and incentivises the same by giving the users Rs.100 in their Paytm wallets.

Desi digital wallets have been successful in making a huge proportion of the Indian population subscribe to their service. The leading desi digital wallet MobiKwik has more than 25 million users. As per a report by TechSci Research India (India Mobile Wallet Market Opportunities and Forecast, 2020), the desi digital wallet market is predicted to reach $6.6 Billion by 2020. However, there is still a long way to go as there would need to be a change in the deep-rooted habits of Indians for a 100% conversion. The world is switching to digital payments and before that happens, Indian wallet companies need to devise a method wherein inter-wallet payments are made a reality. This would be possible if authenticated by a third-party authentication service.

This article was first published in September 2016 issue of Digit magazine. To read Digit's articles first, subscribe here or download the Digit e-magazine app for Android and iOS. You could also buy Digit's previous issues here.