The demand for micro ATMs and m-POS instruments at retail outlets across the country witnessed a whopping rise of 67% in the unlock phase which underlines the critical role played by small retail outlets in driving financial inclusion at the last mile.
When the government imposed the lockdown due to the coronavirus pandemic, there was a sharp decline in the Indian economy and transactional volumes. However, the government’s various relief funds to support citizens during the pandemic saved the day. According to fintech start-up PayNearby, there was a meteoric rise of 96% and 27% volume and value respectively in AePS withdrawals (Aadhaar ATMs) at Kirana outlets across the country during the lockdown.
Reportedly, the growth was a direct result of the measures taken by the government following lockdown. An increase of 61% and 60% in transaction volumes has been recorded as per the insight shared by PayNearby as part of a detailed analysis of ‘assisted digital transactions’.
PayNearby’s Pan-India report titled ‘Retail-O-Nomics’ is based on the transactions registered across more than a million retail touchpoints throughout the country.
The report pointed out that a minor blip (less than 2%) was recorded in the overall gross transaction value of assisted digital transactions at retail stores in the initial months of the lockdown. However, later, a massive surge of 45% in transaction volumes was recorded.
The report also stated that due to a dip in the average ticket size due to cautious sentiments, reduced purchasing power and predominantly small ticket Direct Benefit Transfer (DBT) withdrawals. The result also represented reduced transactions from the metro and urban areas, which observed a sharp decline of 32% and 64% respectively in gross transactional value (GTV). It was due to the decrease in the money transfer business.
It is also worth pointing out that the massive surge in transactional volumes was observed after migrants began moving back to their work locations, as unlocking phase kicked off by the August end. In the general gross transactional value of digital transactions at retail outlets saw a revitalization and augmentation.
Although the average monthly gross transaction value (GTV) grew by more than 17%, transactional volumes saw a decline by about 7%. It reflected the revitalization of money transfer, travel and utility payment businesses, and signified a return of larger ticket size transactions.
As per the report, Travel bookings inclusive of a bus, rail and air at retail outlets also picked up when mid-August relaxed travel restrictions. A steep growth of over 100% was recorded in travel bookings in rail and bus bookings.
While most of the transactional volume increased during the unlocking phase, mobile recharges saw a rise of 39% and 34% in value and volume respectively during the lockdown phase. The surge was reportedly due to increased data and talk-time utilization when most people were forced to stay home.
Coming back to the unlocking phase, demand for micro ATMs or m-POS instruments at retail outlets increased by 67%, underlines the critical role of these small retail outlets in bridging the infrastructure gap while also driving financial inclusion at the last mile.
The report further stated that 48% of the total transactions were registered at Kirana stores between 7 AM to 2 PM. Almost to the tune of 52%, a considerable amount of transactions were reported during the non-banking time zone. This showcases the vital role these Kirana outlets participated in these challenging times in the wake of social distancing and restricted banking hours.
“India was future-proofed by NPCI and Nandan with AEPS. During the lockdown, 115 Mn debit cards were out of the system due to non-compliance with CHIP & PIN guidelines, but AEPS came as a BCP for ATM, helping people access the virtual money remitted by Government of India. The same is reflected in our data, where the disbursal of Direct Benefit Transfer (DBT) wouldn’t have been possible without AEPS withdrawal facility in the region,” Anand Kumar Bajaj, MD & CEO, PayNearby, said on the findings of the report.
These findings also reveal the retail agents’ tireless efforts who ensured they remained available to the masses at all hours of the day. He added, when the entire country was held hostage by the pandemic, these agents served as corona warriors that kept the economy going.
It is heartening to see an accelerated demand within the retail community to enable assisted financial transactions at local stores during these challenging times. We witnessed a sharp growth in retailers who wanted to join the program and added more than 3 lakh registered retailers.
The rise in Micro ATM, mPoS and other digital payment transactions are indicative of the enormous latent demand that exists for easy to use digital payment technology across the country, especially in Tier 2 and beyond regions. Our focus will be to empower our retailers and consumers by blending effortlessly to use technology with last-mile connectivity so that we can bridge the digital divide and create an equal Digital India.”