Cash vs Digital Payment: The Change in Indian Perspective

Cash transactions vs Digital Transactions?

How has digital transaction helped every Indian merchant grow their business manifold?

When it comes to managing your money, how you choose to pay or receive your money is just as important as the amount of money you make. From a barter system that was commodity-based to a cash-based economy and now towards a digital India, we have evolved. We are progressing with time to stay relevant at every step of the way. As the world faces a rapid change in terms of modes of payment, institutions and people are moving towards a cashless economy. For the longest time of our lives, people of the economy have all gotten used to carrying, paying, receiving, and saving hard cash. Old habits die hard.

Many people still prefer cash transactions as it is available at hand and possess no threat of security breaches.

The downside of using cash, however, is that there’s no accurate track of transactions, and an inability to transact from anywhere for anything. Over a billion transactions that happen this way in India are not being tracked or even directed to the economy! Hence, Digital is the way! The period of demonetization and a global pandemic has pushed many businesses and customers to move towards a cashless way of life.

The Divide between Cash and Digital Mode.

In 2020, about 89 % of all transactions in India by volume were estimated to be cash-based, down from 100 per cent in 2010, an October 2020 McKinsey report shows. Among emerging economies, India was second after Indonesia (96%), and ahead of Brazil (74%) and China (41%).

The market that depended solely on hard cash until a few years ago has witnessed a spike in paperless financial transactions. Digital payment methods are now increasingly used to conduct day-to-day transactions in the country and are transforming the way customers buy and merchants sell. From big shops in malls to roadside vendors, from schools to banks, many are now using digital methods of payment.

Shift to Digital

However, there is another side of the coin which can be considered as an opportunity.

India since 2018 has witnessed a significant growth in digital transactions. The following table shows the steady growth of such payment mode:

The Government of India’s flagship program “Digital India” aims to turn India into a digitally empowered society that is “Faceless, Paperless, Cashless”. Several modes of digital payments are available to promote cashless transactions viz. Banking Cards, USSD, AEPS, Mobile Wallets, Prepaid Cards, Point of Sale, Internet Banking, Mobile Banking, Micro ATMs, and UPI. Digital payment has helped businesses grow and have aided customers to access transactions from their place of comfort.

Earlier people used to visit shops with limited cash and therefore could buy limited goods. But now, digital payment modes have aided to keep aside this worry about cash in hand. The ability to pay or receive digitally has become more important than ever, as it benefits both businesses and consumers in many ways. Digital payments are lightning-fast. It enables money transfer round the clock, is relatively secure, provides convenience, is trackable, and provides several mutually attractive deals that have given tremendous opportunities for new aggregators to come into existence.

Dig into the Digital!d

While the country has started moving towards a cashless economy it is inevitable that businesses of all sizes should digitize their business and accept payment through multiple modes, be it cards, mobile wallets, UPI, etc. One of the most important parts of any business is the Point of Sale.

The need of the hour is a seamless, secure and ready-to-go POS using mobile devices such as smartphones or tablets and a mobile point of sale that bundles all commerce and back-end office needs of a business. A Point-of-Sale software is easy to use, the merchant just needs to download the app, choose his plan and complete his KYC to get started.

POS provides different upgraded salient features to the retailers which help them to run a smooth business. The recent innovations and upgraded features helping the retail sectors move and run the business efficiently is the QR payment solution, which is a quick one-step payment solution. The QR code feature allows all the merchants to receive digital payments without the use of a Point-of-Sale (POS) swiping machine.

The customer scans the QR code with any UPI app and enters the amount to be paid. The amount gets instantly credited to the merchant’s account – making both the merchant and the customers happy. Payswiff is elated to be a part of this process and in being able to contribute their bit to the economy.