86% of Indians Likely to Use Mobile Payments By 2018, Big Market For Bitcoin & Blockchain
Study from Quartz India revealed that 86 percent of Indians are likely to use mobile payments by 2018 and by 2020, India is expected to establish a $500 billion digital payments market.
Such rapid transformation of the cash-based economy has allowed newly emerging financial technology contenders to redefine banking in India, with innovative technologies such as Artificial Intelligence (AI), blockchain technology and bitcoin. An increasing percentage of the Indian population have started to prefer more efficient financial networks, applications and peer to peer protocols that simplify and ease banking.
Recently, Quartz India spoke to an executive from the $33.5 billion IT giant Infosys, which has focused on providing and establishing new infrastructures for the Indian digital payment industry to assess the potential of blockchain, bitcoin and other financial technologies that may redefine the financial sector in the region.
Infosys is at a unique position to evaluate the status of the banking industry and the technological transformation that is being led by emerging fintech service providers because it serves some of the largest banks in India. According to various sources, 70 percent of the country’s top 40 banks and more than 100 cooperative banks utilize Infosys subsidiary EdgeVerve Systems’ digital banking platform Finacle to manage their internal IT systems and databases.
In an interview, Infosys associate vice president and head of product strategy Rajashekara Maiya, revealed that despite the nation’s relatively successful recovery from the demonetization of 500 and 1,000 rupee banknotes that caused a financial turmoil across the region, the demand toward digital payments and bitcoin is rising at a rapid rate.
“In India today, non-cash payment transactions by Indians per capita per annum is 11 compared to 26 in China and 728 in Singapore. Look at the number of sale points—point-of-sale units, ATMs, toll booths accepting digital payments. Pay-points per million people is only 1,100 in India—it’s over 16,000 in China and over 31,000 in Singapore. There’s a very large scope of digital transactions getting increased substantially,” said Maiya.
More importantly, Maiya noted that the government is also collaborating with researchers and analysts in order to provide sufficient guidance and infrastructure to facilitate the growth of the digital payments industry.
A part of the Indian government's initiative developed to help its local digital payments industry has been the legalization and regulation of bitcoin, which has attracted the interests of both casual and institutional investors over the past few years.
India’s big three bitcoin exchanges including Zebpay, Unocoin and Coinsecure have all reported exponential increase in their user bases and trading volumes.
Acknowledging the rise in the popularity and demand towards bitcoin and other cryptocurrencies and blockchain networks such as Ethereum, Maiya further emphasized that Finacle has been actively investing into the potential of implementing blockchain technology onto its digital banking systems used by the country's largest and most influential banks.
“Finacle has spoken to many academics who’ve conducted fundamental research in blockchain (and) Silicon Valley startup companies. It helps us in terms of changing the paradigm of payments-especially cross-border payments-and the digital identity of a customer. We’ve trained around 40 of our staff, who we call the “blockchain black bench,” to use their knowledge to create solutions,” said Maiya.
