The Indian economy has witnessed sustained efforts towards digitalization in recent years. Cash has always been the predominant payment instrument in India. It is still well-established and widely used. However, there has been a perceptible shift in favor of digitization.
The Government’s efforts to move towards a cashless economy, demonetization, and active GDP growth have paved the way for a down surge in cash in circulation. As per an RBI report, cash withdrawals have slowed down when compared to transactions done digitally. This reassures that the digital payment system, consisting chiefly of digital or electronic modes for non-cash payments, is rapidly increasing.
Businesses and Payment Systems
Payment systems form the lifeline of an economy. Today, they help achieve financial inclusion ensuring that economic benefits are spread across the sectors. However, cash is still the king. Paying with cash requires calculations, and you need to carry cash on you every time. This might not be safe as it makes you susceptible to thieves, and you may lose it.
As India becomes a hotspot for start-ups and entrepreneurial ventures, small and large businesses are observing the need to adapt to other modes of transactions, with an increase in transaction volumes. As a result, they are switching to cashless methods of transactions and receiving payments. This leads to an inevitable query: what is the reason for the popularity of cashless transactions?
Let us take a look at the benefits of a cashless digital payment system for you and your business.
How are digital payments the formula for your business success?
- Expanded Reach
Your business needs more customers so that you can maximize your revenue. With traditional payments, like cash, you get bound by geography so that you have a limited reach. A digital payment system can help expand your customer base pan India. Since you can now make payments from anywhere, you don’t need to take your businesses to a specific geographical region.
- Improved Cash Flow
Businesses and start-ups need continuous cash flow to keep their operations running. As per a Statista report, digital payments in India have increased from 20.7 billion INR in 2018 to over 53 billion INR in 2021. This is because online payments are easy and quicker than traditional payments.
Businesses can accept more payments with an online payment gateway and better manage the transactions. In addition, the payment gateways come with advanced analytics and a dashboard to monitor transactions. Estimating your cash flow from this data becomes easy rather than sitting down and making cost calculations.
- Available 24 X 7
Digital payments give your business an improved power to accept round-the-clock payments, even past midnight. RBI’s NEFT became a 24×7 facility, starting from December 2019. Available online throughout the year, including bank holidays, this has further led to the popularity of payment gateways supporting these payments.
You don’t have to worry about ATMs close by to arrange for cash or banks being not open or delaying cheque clearance. This can significantly increase your sales and provide you an added benefit of customer satisfaction as customers can now pay as per their convenience.
- Multiple Options Available
The major USP of a digital payment method is its versatility to customers. They can choose from a diverse list of payment methods as per their accessibility and ease. As a result, most Indian customers are leveraging digital payment options like bank cards, UPI, digital wallets, mobile, internet banking, and Pay Later options.
All online payment gateway in India provide options for virtual banking where you can easily make a transaction through NEFT, IMPS, or RTGS services. A robust payment gateway like ZaakPay provides you with super-quick and secure payment options to boost your business.
- Ease of Access
Due to the increase in internet and mobile penetration in the country, there has been an advent of innovative . Customers can easily use them on their mobile internet anytime and anywhere. No wonder the electronic payment options constituted a share of 61% by volume and 75% by value in the retail payment space during the FY 2019-20, as per the RPI report.
Statistics show that today digital payments are almost three times what they were in FY18. The Reserve Bank of India’s digital payments index (RBI-DPI) shows an increase from 100 points in 2018 (base year) to 270.59 points in March 2021 which represents growth in the payments infrastructure and hence, captures the spread of digitalization.
- Secure Transactions
Digital payments are more secure as compared to dealing with cash. It ensures that the transaction is encrypted. A high-quality payment gateway like ZaakPay uses 128 bit encoded SSL encryption. This keeps your debit or credit card information highly secure. The gateways will authorize any payment only after authentication from your issuing bank.
Moreover, most digital payment channels provide regular notifications, statements on the payment status, and payment history. You can easily track your frauds anytime and stay vigilant with payment reminders and fraud alerts.
What do we conclude?
The surge in every form of digital payment continues, demonstrating the shift to a digital ecosystem. The present payment systems use state-of-the-art technology and are affordable, convenient, efficient, and safe. As more and more businesses realize the importance and benefits of digital payments, they are breaking the shackles of cash payments. Small steps taken in the retail payments space are now transforming into giant strides in the Indian economy.
use the same keywords provided on the sheet. It’s only “digital payment system” not “systems”