Post demonetisation, we see even petty shops equipped with Paytm wallets. While we thought the country is embracing the digital era with open hands, a recent study suggests otherwise. With the ATMs filled with cash, thereby providing a respite to serpentine queues, the use of e-wallets fell by 50% in the first two months of 2017.
Brickwoods Media, powered by Chrome Data Analytics and Media conducted a study on the impact of usage of wallets post demonetisation. The found that there was a drop of 49.14% in the usage of electronic cash as 31.8% of the total respondents used it in January and February compared to 64.7% in November and December.
Pankaj Krishna, Founder, and CEO of Brickwoods media told The Hindu, a leading Newspaper in India that the daily frequency of usage for e-wallet payments has decreased by four times post demonetisation as the cash flow returns to normal.
According to the report, certain areas like travel, online purchases, and payments at petrol bunks, local food joints are being accessed through e-wallets. However, after the availability of enough cash, the usage of digital wallet has come down and debit/credit cards have gone up.
“Having said that, given infra around e-wallets will increase due to the digital push by the government; e-wallets should become a viable alternative for payments in future,” Krishna told The Hindu.
There was a total of 13,611 respondents among eight metro cities including Kolkata, New Delhi, Ahmedabad, Hyderabad, Pune, Mumbai, Chennai, and Bangalore.
Companies that saw rise post demonetisation (and fall now)
Paytm, Mobikwik and Freecharge saw a significant rise in the number of users. In November 2016, the mobile wallet transactions stood 138.09 million and the value jumped to 213.11 million in December.
According to the study, the number of daily users of e-wallets has declined to 9.2% from 39.8% while those using it once in 2-3 days fell to 12.3% from over 42% The number of people using e-wallets once a week increased to 42% from 13% earlier.
Business Model of the three
The business motto of Paytm initially, was to earn money through commission on mobile recharge and electricity, water and other bill payments. Now, they have a marketplace model where they are providing a platform for people to sell their products.
MobiKwik earns money through bill payment and mobile/DTH recharges.
Freecharge is an e-wallet where you can only use the money in that application. They get a commission from mobile and DTH operators and also from the brands offering coupons which they give after every recharge. It ranges from 5 to 20%ased to