India Moves Towards A Digitised Economy

Connectivity, security, costs and bitcoin usage are among the key issues to be resolved as India moves towards a digitised economy.

- Kanishka Gupta

Mobile-based digital payments have been growing phenomenally worldwide. Around 23 per cent of global consumers have adopted it, according to surveys, while among early users of smartphones, the figure is 35 per cent. The Scandinavian nations – Norway, Sweden and Denmark – as well as the UK, France and Belgium are well on their way to becoming entirely cashless. Close on their heels are Canada, Australia and South Korea. India is way, way behind, but with the acute cash shortage following the demonetisation decision, it is expected to also take a quantum leap in the same direction soon. What are the main concerns as usage of e-wallets and plastic money multiplies and bitcoins grow in popularity?

CONNECTIVITY AND SECURITY

The first major challenge to taking the cashless economy to every corner of the country is poor Internet connectivity and limited smartphone penetration. "The basis of digital currency is connectivity," says Tejasvi Mohanram, founder and CEO of personal finance platform, Rupee Power. “Unless net connectivity improves radically in rural areas, online transactions can never become a way of life.” Not surprisingly, e-wallet companies like Paytm and MobiKwik are trying to overcome the problem in different ways, but as long as connectivity remains sporadic or limited, a cashless economy will be a distant dream. “We have launched a lighter version of MobiKwik called MobiKwik lite, which can even be used by old smartphones with low data connectivity,” says Bipin Preet Singh, Founder-CEO and Director, MobiKwik. “A mechanism by which even feature phones will be able to make payments using SMSs is also being worked on.”