“Launch of innovative payment products such as UPI, NETC-FASTag, and BBPS among others has driven the growth of Payment Services Market in India.”
Digital India Campaign and Economic Goals: The government of India has been extensively focusing on
“Digital India” campaign initially launched in 2015 to improve the online
infrastructure of the country to ensure that the government services are made
available to citizens electronically. E-Rupi is one such program developed by
Department of Financial Services (DFS), National Health Authority (NHA) and
NPCI, under the broader “Digital India” campaign formulated in order to enhance
cashless payment transaction for COVID-19 vaccination. As citizens are more
concerned for their health and safety followed by the aftermath of COVID-19,
the implementation of e-RUPI program is a pragmatic development by the
government to not only promote the idea of digital payments but also ensuring
safety of citizens as the whole process is based on cashless transaction
without the need of physical payments. Before the advent of COVID-19, the
government of India had set an economic target of achieving a USD 5 trillion
economy by FY’2024-FY’2025, to be driven by the digitalization of the economy.
With policies such as demonetization being framed since 2016 in order to
achieve the digital goals of the government, emphasis has been on shifting to an
online medium of transaction considered to be hassle free, convenient,
transparent and most importantly, secure form of payment. Adaptation to digital
medium of transactions ensures a greater opportunity for the digital payment
services, gateway and security market in the future.
Credit and Debit Card Coverage: Over the years, money has transformed from coins to physical
cash and is now available in electronic / digital form or plastic cards.
Plastic cards for instance, ATM cards, debit and credit cards are used by
customers as an electronic payment tool, thereby helping in clearing and
settling the payment process. Increasing penetration of credit cards in metro
areas coupled with rising usage of RuPay cards in tier 2 and tier 3 cities are
some of the driving forces in India consumer payments landscape. With recent initiatives and emphasis
by the government in banking the unbanked population, the user base of debit
and credit cards have witnessed tremendous surge in recent years. However with
the advent of COVID-19, the preference of consumers has shifted towards
cashless transaction rather than traditional medium of cash based transactions.
The shift to cashless transaction could prove to be a major downside to the
credit and debit card market in the coming years.
Shift in Consumer’s Payment Preference: A shift in consumer’s payment preference was noted with the
advent of unprecedented situation of COVID-19 wherein individuals are relying
more on online transactions rather than the traditional medium of cash based
transactions. Surge in growth of electronic payments in India, along with
rising E-commerce and M-commerce transactions are further expected to give a
boost to numerous entities including payment gateway service providers and
payment aggregators that facilitate online payments in the country.
Growth
of India M-Wallet Market: Mobile wallet market in India is acting as a
catalyst towards developing digital payment infrastructure. The adoption rate
of the consumer for online shopping and buying groceries has been at an
all-time high since the pandemic broke out. With restrictions imposed
nationwide, consumers relied on e-commerce platforms for buying products
online. In this whole discourse, m-wallet market witnessed a tremendous growth.
The transaction value of M-Wallet market stands at INR 3,999 million as of June
2020, which is expected to expand with a CAGR of ~13.7% during the period of
FY’21-FY’26.
Launch of New and Innovative Payment Products: The launch of new and innovative payment products like
Unified Payments Interface (UPI), National Electronic Toll Collection (NETC)
FASTag and Bharat Bill Pay Service (BBPS) have firmly placed the digital
payment industry on an upward growth trajectory. As of June 2021, the value of
NETC transaction stands at INR 25.56 billion which is expected to grow at an
exponential rate in the future. With the surge in adoption of these newer
payment methods, global giants such as Whatsapp, Google and Amazon Pay are
aiming to improve their on-platform transaction convenience to enhance customer
retention.
Increased Mobile and Internet Penetration in India: Increased mobile and internet penetration in
the country has resulted in significant shift towards use of
mobile/internet-based payment systems, for effecting payments for purchase of
goods and services. It is estimated that as of FY’2020, 53% of India’s total
population had access to internet from their mobile phones. Introduction of
lightweight acceptance infrastructure (QR codes) has further facilitated the
use of mobile-based payments across the country. This has led to a larger
population accessing digital payment services having access to convenient
payment systems at their disposal. India is ranked second in the world in terms
of active internet users, having merely a 4% internet penetration rate in
FY’2007 increasing to a striking 50% penetration rate of the overall population
as of FY’2020. The gradual increase in internet penetration rate enables the
consumer in accessing digital payment services such as UPI, m-wallets and QR
based transactions among others. With the advent of COVID-19, consumers are
relying on digital payment methods rather than traditional medium of cash based
transactions which are contributing in rise of contactless payments.
Point of Sale (PoS) Terminal Market in India: PoS terminals were launched as a computerized replacement of
cash register where customers can make an online transaction with the help of
their debit or credit cards. India PoS terminal market is heavily dependent up
on the card acceptance infrastructure consisting of ATMs and PoS terminal
devices. In terms of number of device installations, metro cities dominate
India PoS terminal market majorly due to higher usage and penetration of debit
and credit cards in these cities whereas, non-metro cities were observed to catch
up by spreading awareness regarding PoS devices enabled with Adhaar enabled
Payment System (AePS) and Micro ATMs in rural India. Large retail formats, such
as Big Bazaar, Shoppers Stop and other malls in recent times, have initiated
the process of installing traditional PoS systems that work on GPRS technology.
Integration in the rural region along with lower TIER cities could contribute
in PoS market witnessing massive growth in coming years.
Digital Incentive as
Mentioned in Union Budget 2021: A
striking announcement in the Budget 2021 revealed an allocation of Rs 1,500
crore towards MeitY for the promotion of digital payments. Other incentives
such as tax audit exemptions for businesses utilizing digital payments and the
establishment of Fintech hub were also announced. These funds are expected to
be utilized in encouraging digital payments for toll transaction and
investments for marketing campaigns to raise awareness not only in the urban
areas but also rural regions. These incentives exacerbate the opportunity of
various players in the payment services market to integrate into lower tier
cities to expand their presence and to build a robust payment infrastructure in
the country.
Payment Security
Services: With more emphasis on technological
dependence in recent years, cyber security has emerged to be a domain of
tremendous value. Following the aftermath of COVID-19, interned adoption rate
surged. As physical restrictions were imposed globally, people started
utilizing digital means for communication, work, shopping etc. The shift to
internet domain was not only specific to individuals but even businesses
wherein "Work from Home" became the norm. However with increased
dependence on internet and digital medium, there lies security concerns related
to cyber threats. To enhance security and compliance standard, governments
throughout the world initiated shaping polices and regulations for
strengthening the cyber security ecosystem. With increased dependence on
digital payment mediums, entities, government agencies, organizations,
e-commerce platforms need to ensure that they provide a safe and secure
platform for their consumers for a transparent transaction procedure. India in
2017 ranked among top five countries to be affected by cybercrime. The rising
cybercrime incidences would ensure Indian entities emphasizing on strengthening
their IOT and cloud security framework in the coming years eventually leading
to a growth opportunity for the payment security services market.
The
report titled “India
Payment Services Market Outlook to 2026” by Ken Research suggested that the India
payment services market is expected to grow further in the near future, with
the growing dependence on digital payment ecosystem. The market is expected to
register a positive CAGR of 7.0% in terms of transaction value during the
forecast period of FY’21-FY’26, with the digital payment market growing at a
faster rate.
India Payment Services Market
By Payment Card Usage (Cash Payments and Cash Withdrawals)
By Number of Outstanding Debit Cards (PSU and Private Banks)
By Number of Outstanding Debit Cards: Market Share of Banks
(State Bank of India, Bank of Baroda, Paytm Payments Bank, Punjab National
Bank, Union Bank of India, Bank of India, Canara Bank, ICICI Bank and others)
By Number of Outstanding Credit Cards (PSU and Private Banks)
By Number of Outstanding Credit Cards: Market Share of Banks
(HDFC Bank, State Bank of India, ICICI Bank, Axis Bank, Ratnakar Bank, Citi
Bank, Kotak Mahindra Bank, American Express and others)
By Modes of Payment (RTGS, Credit Transfers, Debit Transfers,
Direct Debits and Card Payments)
Credit and Debit Card Coverage
By Number of Credit Card Transactions (PoS and ATM)
By Credit Card Transaction Value (PoS and ATM)
By Number of Debit Card Transactions (PoS and ATM)
By Debit Card Transaction Value (PoS and ATM)
By Number of ATMs and PoS Terminals
By Number of Outstanding Cards (Credit and Debit Cards)
Immediate Payment Service (IMPS)
Consumer Payment Landscape
By Type of Institution (Small Finance Bank, PSU, Private and
Payments Bank, Public and Private Institutions, Regional Rural Bank and
Co-operative Banks)
Aadhaar Enabled Payment System (AePS)
Consumer Payment Landscape
By Types of Banks: Number of AePS Operator (Mainline
Commercial Banks, Regional Rural Banks, Co-operative Banks, Payment Banks and
Small Finance Banks)
India PoS Terminal Market
By Number of Terminals (Active and Inactive Terminals)
By Metro and Non-metro cities
By End User Industry (Large Enterprises, SME’s and Micro Merchants)
By Metro and Non-metro cities
Key Target Audience:-
Banks and Financial Institutions
Cash Reconciliation Companies
Payment Aggregators
Payment Network Companies
Payment Interface Companies
M-Wallet Companies
Payment Gateway Companies
PoS Terminal Companies
M-PoS Terminal Companies
Time Period Captured in the Report:-
Historical Period: FY’15-FY’21
Forecast Period: FY’21-FY’26E
Payment Service Companies in India:-
M-Wallet Companies
Paytm
Mobikwik
Freecharge
Oxigen
Telecom Operators (Jio Money, Airtel Money, Idea Money,
Vodafone M-Pesa)
Others (SBI Buddy, PayZapp by HDFC, Pockets by ICICI and
other bank wallets)
Payment Gateway Companies
PayU
Paypal
Razorpay
Others (CC Avenue and Citruspay)
PoS Terminal Companies
Ingenico
Verifone India
PineLabs
PAX Technologies
Ezetap
Itzcash
M-PoS Companies
M-Swipe
Payswiff
Mosambee
Bijlipay
Key Topics Covered in the Report:-
India Payment Services Market
Regulatory Framework in India Payment Services Market
India Payment Services Market Segmentation
India Payment Services Market Future Outlook and Projections
Credit and Debit Card Coverage
Immediate Payment Service (IMPS) Consumer Payment Landscape
Aadhaar Enabled Payment System (AePS) Consumer Payment
Landscape
Unstructured Supplementary Service Data - Bharat Interface
for Money (USSD-BHIM) Consumer Payment Landscape
Unified Payments Interface (UPI) Consumer Payment Landscape
Cross Comparison of Different Payment Modes (IMPS, AePS,
USSD-BHIM and UPI) in India Payment Services Market
India Bill Payment
Market
India Omni-Channel
Payments Processing Market
India Bank
Reconciliation Software Market
India Digital Payment
Market
India Cloud Security
Services Market
India Payment Security
Services Market
India M-Wallet Market
Market Share of M-Wallet Players in India
Competitive Landscape of India M-Wallet Market
Trends and Developments in India M-Wallet Market
India Payment Gateway Market
India Point of Sale (PoS) Terminal Market
India Point of Sale (PoS) Terminal Competitive Landscape
India Point of Sale (PoS) Terminal Market Segmentation
India Point of Sale (PoS) Terminal Market Future Outlook and
Projections
India m-PoS Market
CUG Cards / Prepaid Closed Loop Cards
Cloud / Security Outsourcing in Payments Technology
Government Regulations
Assessment of COVID Impact on
Contactless Transactions and POS Terminals
Coverage on OMC Digital Space
For More Information,
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