THE PRODUCT ADOPTION LIFE CYCLE FOR MOBILE WALLETS IN INDIA


Introduction

With the smart phone boom in the Indian Market the number of people using smart phones are growing and this has become a part of their life. Ease of Internet connectivity has made people to make internet as the apart of their daily activity. The smart phone market is growing in India day by day. Along with that the network costs are coming down and people are getting more aware of internet and they are always connected.

With this change the trends are changing to online mostly and people are shopping more online. Most of the companies in India are moving online. With the change in the banking systems and demonetization and promotion of online payments, the change in the cash transactions are happening. People are moving to cash less transactions. Mostly they are using digital cash payment systems. Now everyone is using Mobile payment or wallet payments. The mobile wallets are the digital wallet available everywhere linked to your mobile number to do any kind of payments, making the transaction fast and easy.

The mobile wallet payment is becoming more popular as the flexibility and the ease of the payment on the various good and regular update on the transaction and connectivity of these wallets in the payment methods of various companies. The main ease they provide in carry no cash, no change problem and so on.

A recent study suggested that the mobile-wallet market in India is anticipated to rise at over 190 per cent to reach Rs.1512 billion by financial year 2022, that currently is about Rs.1.5 billion.

Types of wallets 
 There are four types of mobile wallets available in India — open, semi-open, semi-closed and closed.

Open wallets

They allow us to buy goods and services, withdraw cash at ATMs or banks and transfer funds. These services can only be jointly launched with a bank. M-Pesa by Vodafone and ICICI is one such example. Apart from the usual merchant payments, it also allows you to send money to any mobile number bank account.

semi-open wallet

Airtel Money is a semi-open wallet, which allows you to transact with merchants that have a contract with Airtel. You can’t withdraw cash or get it back. You’ll have to spend what you load.

Closed Cccounts

Then, there are closed accounts, which are quite popular with e-commerce companies, where a certain amount of money is locked with the merchant in case of a cancellation or return of the order or gift cards.

Semi-Closed Wallets

Lastly, there are semi-closed wallets like PayTM, which do not permit cash withdrawal or redemption but allow you to buy goods and services at listed merchants and perform financial services at listed locations.

To get more clarification on the types of wallets that are there in India.

Product Adoption Life Cycle

The

product adoption is the typical map to the customer adoption curve. the phase of the mobile wallet adoption in the market is changing. There are many factors that are causing this.

The adoption of the mobile wallets is it the Early majority after the demonetization.

Innovators :

There are the people in the who are tech savvy segment. These are the users who are online payers. They are the people from urban areas with the age group of 18 to 35. Eg: Students, Tech Employees, bank employees.

Early Adopters

These are the guys who check and give their reviews on the products. These guys are the adopters for the product in the market they include the urban population of students, tech employee’s bankers, shopkeeper, Ecommerce Buys, Mobile recharge

Early Majority:

For the mobile wallets the demonetizations has changed this phase and helped the wallets to cross the chasm. The government initiative on this has helped the mobile wallets to reach to lot of segments in the market. With this they spread to rural and urban crowd. In the upper middle and rich segment of both the markets. Every shop keepers has started accepting this mode of payment.

For example, PayTM offering offline POS for small and medium merchants in rural and semi-urban areas.

Late Majority:

The late majority are the stage who see all the users using it take the reviews and slowly move into this. it has not penetrated in this stage yet. There might be few urban users from 40+ age group who might try it out but still depends on the traditional mode of payments.

Laggards:

Generally, more age range people and doesn’t like to pay online. May be more of illiterate crowd.

Factors which affected rate of mobile wallet

· Increase in Smart phone users

· Reduction in internet charges and Awareness on internet.

· Demonetizations

· Promotions of cashless transactions by the government

· Increase in the Awareness and the safety

· Integration of the mobile wallets in most of the company’s payments methods

· Reach of the mobile wallet companies like payment even to pani puri shops for the paymets.

· Cash back offers these mobile wallets providing

Advantages of Digital Payments:

· Easy and convenient:

· Pay or send money from anywhere

· Discounts from taxes

· Written record

· Less Risk

Challenges of digital payment:

· Internet connectivity in areas

· Literacy rate

· The consumer mind set towards safety

· Competition with the Debit cards

· Complexity in understanding the wallet environment

· Customers having multiple wallets.

Drawbacks of Digital Payments:

· The risk of data theft

· Overspending

Growth and product adoption comparison with other payment methods:

Technology illiteracy is the major challenge for the mobile wallets to spread in India even though they have lot of potential. And the customer mind set towards the payment methods is also one of the major issues.

There are multiple payment methods

Cards — Debit cards, Credit cards

Cards are provided by banks to their account holders. These have been the most used digital payment modes till now. Many of us use cards for transferring funds and making digital payments. Credit cards, debit cards and prepaid cards are the main types of cards. These are issued by banks and some other entities authorized by RBI. Most of the bank account holders hold this card. People mainly use this card for swiping against purchase. Nest to COD most of the Online payments happen on this method.

E-Wallets

E-wallet or mobile wallet is the digital version of your physical wallet with more functionality. You can keep money in this wallet and can use it as and when we need it. They can hold money as many days as you want clearly maintaining the transaction record. This money needs time and efforts

Growth hacks used

· Partnering with Multiple Ecommerce companies

Example: PayTM partnering with Uber

· Offering Recharge and day to day house hold payment services like Current bills

· Cashback offers on the products and the services that are purchses throught the wallets.

· Integration the payment method of various companies. Like Myntra and Flipkart payment methods has Paytm.

· Online advertisements

· Social media marketing

· Making people well ware about the Wallet transfers like Auto guys and pani puri guys using Paytm.

· Demonetization

· Government promotions on E-Wallets

· Tax exemption for mobile wallet payments.

Summery

Thus the mobile wallets payments has been growing in India and the number of user adopting this mode of the payments are increasing. As the Government of India is promoting this with all the benefits provided to the users and encouraging the uses to do more transactions this way. The Mobile wallet are going become the part of the life styles as it has reached most of the shops as the payment method.

References

· http://www.india-briefing.com/news/growth-of-digital-payments-systems-in-india-14797.html/

·http://www.imap.com/Reports/Q4%202016%20Payments%20Industry%20in%20India.pdf

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