Mobile Payment On The Rise In India
Indian consumers are increasingly using mobile applications for managing their finances, and are rather comfortable with this mode of payment unlike in the past. Many of them are also using mobile for paying for utilities bills and household groceries, says a study conducted by research firm Ovum on behalf of Amdocs. The survey also found that Indian consumers are increasingly using social networking channels to buy products and services advertised on social networks, pay utility bills, and transfer money to friends and family.
“Although active MFS usage remains modest in India, what stands out from the survey is that the majority of the active base have already embraced more advanced mobile financial services and associated m-commerce applications, including social commerce,” said Eden Zoller, principal analyst with Ovum. “Service providers must ensure they have a well-drawn out product road map to carry users along the MFS adoption curve, from simple to more advance applications.”
Slow but positive
The study while finding out as to what extent consumers are getting comfortable using mobile apps to manage their finances 34% of respondents say that they are very comfortable using mobile apps to manage their finances, while 27% are somewhat comfortable. However, this number is less for unbanked respondents, of whom 27% are very comfortable with mobile financial services, and 19% are somewhat comfortable.
Needless to say then that in-person payments still dominate shopping in India and cash is by far the preferred payment instrument; however the use of digital and mobile channel for utilities bill payments and buying household groceries is growing. Twenty-seven percent of respondents pay their utilities bills online using their laptop or desktop, while 19% use mobile banking to pay for them. Twenty-one percent of respondents say that they buy household groceries online and 17% use a mobile app to pay for it.
“A sizable population in India is gradually moving towards the cashless economy, even though financial inclusion still remains a challenge for majority of the people,” said Sharath Dorbala, head of sales, marketing and products for mobile financial services at Amdocs.
Rise of social commerce
Buying products advertised on social networks is the most established type of social commerce payment service, and given the high growth of social networks in India, this is set to grow further. The respondents showed the highest usage for buying products/services advertised on social networks (33%), followed by usage for paying bills via social media (30%), and transferring money to friends and family (17%). In terms of future adoption of social commerce in the next 12 months, 18% of respondents say they are likely to buy products and services on social networks and transfer money, while 17% say they would use these channels to pay bills.
“The market trends indicate that a mobile financial services solution that can integrate well with social network platforms can be a boon for Indian mobile financial services providers, as most of the online transactions will happen on mobile devices in the future,” concluded Dorbala.
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