Demonetisation has affected all sectors from consumer durables, travel industry to automobiles. At the same time, fledgling digi-wallet start-ups and e-commerce start-ups have been the unintended beneficiaries of demonetisation. One other sector that has benefitted is the corporate benefits sector.
Companies like Sodexo and Ticket Restaurant were the first introduce the ‘cashless’ concept in a way. The paper vouchers distributed by companies to their employees came as a replacement for cash at stores that accepted these vouchers. The primary selling point of these vouchers was the meal vouchers (up to a certain limit) are tax-exempt under the Income Tax Act.
Spike in queries and transactions
This year saw the launch of Zeta, a new player, whose prime feature is that it is a digital alternative to paper meal vouchers. According to, Shailaja Kumar - VP- Head Enterprise Sales, Zeta, “Over the past couple of weeks, we have witnessed an increase in the number of queries from corporates for Zeta Optima's suite of tax benefits products.”
Sodexo, the major player in the market, with 80% market share, witnessed a spike in transaction of over 100% over the P3M levels during the last month. According to Suvodeep Das, Vice President – Marketing, Sodexo Benefits and Rewards Services, “The Sodexo cards and vouchers have proven to be a boon for consumers because they could shop for their food and grocery freely across the country even when they did not have cash.”
Zeta also received fresh interests. “We have also seen a spike in employee conversions of our existing clients. Being an optional product in the payroll, an employee can opt for it. In the recent days, we have seen more employees opt for digital meal vouchers or medical reimbursements as digital payments are picking up steam,” Kumar said.
Sodexo to launch digi-wallet
Keeping up with the trend of going digital, Sodexo launched an app – Sodexo World - a couple of months ago. The key feature of the app was a list of merchants who accept Sodexo meal vouchers. In this demonetisation season, the company plans to take the app to the next level by adding a mobile payments feature as well as real-time deals and discounts soon.
When the app is launched, the Sodexo meal card will be linked to a mobile wallet to ensure seamless access to the consumers’ funds. “The consumer will identify the Sodexo merchant at the PoS by either scanning a QR code or entering the merchant’s mobile number. To pay, the consumer will enter the amount and a secure PIN,” Das explained. This app will address the two main concerns with regard to paper meal vouchers: locating merchants who accept the vouchers, and time consumers spent figuring out payments from their voucher booklets.
A few years ago some merchants had refused to accept Sodexo meal vouchers at their stores because of the high cost of handling paper coupons, delay in payments from Sodexo to merchants. Both demonetisation and the Sodexo digital wallet will give Sodexo the much needed edge in the current digital environment.
Impact on the ecosystem
The cash crunch has driven employees to seek out more meal vouchers, Das said. “There are many clients who have requested for increased number of Sodexo vouchers/ increased load on their employees’ Sodexo cards,” he said. Employees generally opt to receive abput Rs 2000 per month in the form of Sodexo coupons. Given the high demand for high value Sodexo cards, the company is currently working on a multi-pronged digital campaign to communicate the benefits of opting for more Sodexo vouchers/higher value load on cards to its clients.
Demonetisation has overnight pushed Indians into learning about and becoming aware of cashless alternatives. “The recent demonetization helped push merchant adoption due to increased awareness and interest from merchants to accept digital payments. Our per day conversions of merchants increased from 3-4 a day to 8- 10 day,” Kumar shared.
Kumar said, that following demonetisation she anticipates a rise in Zeta’s merchant networks due to the conveniences it brings in day-to-day life. “We currently have a few lakh outlets where Zeta works but demonetization will see a few thousand smaller outlets who only accepted cash moving to a Zeta. This will change the entire ecosystem in India,” she said.