Digital Education for retailers and consumers is necessary for India to become truly cashless

Merchants are the key to solving the puzzle of digital payments. They need to be educated and empowered first. Their adoption of digital payment equipment will then urge the consumers to utilise digital payment methods.

23rd Nov 2019
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Over the past three years, a number of initiatives have been taken by the government to steer the Indian economy towards digitalisation. To incline consumers towards digital payments, various efforts have been initiated to provide better internet connectivity, technologically advanced equipment and security against hackers. There has also been a rise in digital credit into bank accounts due to the government’s direct-benefit transfers, and digitalisation of government payments. Over time, the transition from cash to cashless has improved considerably and this shift to electronic transactions has increased transparency for businesses, SMEs, MSMEs as well as the consumer. 


Although the digital payment industry has shown tremendous growth, there is a large pool of informal group which still runs on cash. As per the recent PwC &Assocham report titled “Emerging technologies disrupting the financial sector”, in India digital payments’ transaction value between 2019 and 2023 is expected to grow at a compounded annual growth of 20.2percent to $135.2 billion in 2023 from approximately $64.8 billion this year. However, to harness the huge potential there is a need to educate businesses, retailers, and consumers on the benefits of digital payments. 


Over the past few years, digital payments have developed as an important tool for encouraging financial formation in India due to prime factors such as - reduced costs of rendering services, availability, convenience, reliability, and traceability of every transaction. These aspects are not only beneficial for consumers but, highly empowering for the retailers and businesses as well. 


To provide retailers with the advantage of reliable and traceable transactions, tools to enhance transparency are the need of the hour.


To be truly cashless, retailers should make a conscious shift and strategised initiatives must be implemented by the industry bodies. Clearly, there is a lot that needs to be initiated to achieve the end goal of realising the ‘Digital India’ dream. However, the onus does not lie solely with the government and enterprises. Government and individuals have to come together to bring about the necessary change. Providing seamless access to electricity and improving internet connectivity, generation of formal sector employment, improvement of the educational and skilling outcome, and universalising access to financial products such as savings instruments, insurance, and credit is also essential. 


I believe merchants are the key to solving the puzzle of digital payments. They need to be educated and empowered first. Their adoption of digital payment equipment will then urge the consumers to utilise digital payment methods. 


On the consumer end, the digital payments industry would need to address some challenges such as low margins primarily due to a cashback-driven culture, process inefficiencies like Know Your Customer bottlenecks and cybersecurity threats. Hassle-free mode of payment enables the customers to complete the transaction in a quick and easy way.



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