The Swipe Network

As India’s digital landscape evolves, simple mobile point-of-sale machines have morphed into full-fledged payment platforms with value-added services

- Varsha Meghani

Recently, after buying books for his grandchildren from a shop in Shimla, President Ramnath Kovind tweeted, “Happy to experience the spreading digital payments culture in our country.”

This “culture” got a big boost in November 2016 when Prime Minister Narendra Modi declared 500- and 1000-rupee notes—which made up 86 percent of the cash in circulation at the time—null and void. Upstarts like the now-ubiquitous mobile-wallet company Paytm surged in usage, going from 115 million registered users at the time of the announcement to 160 million in just 60 days.

Besides mobile wallets that dominated the market immediately after the demonetisation, the usage of Unified Payments Interface (UPI), which enable instant transfer of money from one bank account to another on a mobile platform, has also been on the rise since November 2017. According to the Reserve Bank of India (RBI), 171.4 million UPI-based transactions, totalling ₹19,120 crore, were recorded in February 2018, eclipsing the 113.1 million transactions worth ₹3,650 crore clocked by prepaid instruments, including mobile wallets.

But despite the surge of mobile wallets and UPI, debit and credit card transactions still form the bulk of digital payments. RBI’s data shows that 247.1 million transactions worth ₹46,590 crore were carried out through debit and credit cards in February 2018, making up 22.5 percent of all digital transactions by volume.