Urban Indian businesses see growth in accepting digital payments: Kantar ITOPS report
The report states that close to half of the businesses using digital payments are in the retail segment
Kantar has come up with an annual report on digital adoption and usage trends in India. The ITOPS 2019 report indicates that about 42% of urban businesses are aware of UPI/ eWallet as a means of receiving payments from their customers and about 29% of them use UPI/ eWallet for receiving payments.
The report further states that, given the size, close to half of the businesses using digital payments are in the retail segment and the ones relatively averse to digital adoption are travel, trade, transport, logistics and education.
However, in spite of the fact that about 29% of businesses are accepting UPI/ eWallet, in terms of the share of total receipts of businesses, UPI/ eWallets account for only 6% of the total receipts. Amongst businesses that adopt UPI/ eWallets users too, about 23% of the total receipts are through UPI/eWallet.
As per ITOPS 2019, cash continues to have the dominant share of the market. Across the entire market, the share of cash is currently 87%. However, amongst the users of UPI/ eWallet, the share of cash is much lower at 58%. This indicates that businesses using UPI/ eWallet are also adopting other Digital Payment options in addition to UPI/ eWallets.
Tier 1 cities of Delhi and Mumbai lead the adoption of UPI/ eWallets with about 45% of businesses having adopted it. Interestingly, smaller cities like Rohtak, Haldia, etc. also show high adoption with more than one in every three businesses adopting UPI/eWallets though transaction volumes are low. This indicates the penetration of UPI/ eWallets goes beyond the larger cities and there is definitely a demand for merchant transactions in the smaller cities too which is driving businesses to adopt such services for their customers.
Talking about the eWallet usage amongst Indian business units, Biswapriya Bhattacharjee, Executive Vice President, Insights Division, Kantar, stated: “UPI/eWallet and digital transaction has become almost a necessity in this pandemic-hit world. Indian businesses have started adopting UPI/ eWallets in a big way in recent times, having thrown into the deep end of the pool. Covid-19 is the worst of crises that our generation has witnessed and with no notes to refer to, Indian business entities are resorting to technology adoption, in order to stay afloat. Our idea of financial transaction have always been cash and that thought process has been very deep rooted in our minds. We have seen the first round of adoption of digital payments post demonetisation. However, Covid-19 crisis has accelerated technology adoption amongst the urban businesses and digital payment receipts is at the core of this shift. Our data indicate that about a third of the urban businesses have started exploring the possibility of adopting digital payments for their business since the lockdown. We believe that this shift amongst businesses is here to stay as businesses realize the ease with which they can do their business, especially, in the urban cities.”
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