Best Software Product – Enterprise Solutions at 27th Annual HYSEA Innovation Summit
Best Prepaid Card Solutions at IAMAI India Digital Summit, 2019
Best Prepaid Card of the Year At the 7th Edition of Payments & Cards Summit 2019
  • Redeem Zaggle Propel Card
  • Manage Zaggle Cards
  • Buy Gift Cards
  • We are Hiring!
company_logo
  • no_image Login/Sign Up
  • Gift Card Deals Gift Card Deals
  • Redeem Zaggle Propel Card Redeem Zaggle Propel Card
  • Manage Zaggle Cards Manage Zaggle Cards
  • Propel Propel
    • Overview
    • Solution
    • Pricing
    • Support
  • Edge Edge
  • Save Save
    • Overview
    • About
    • Contact Us
  • Select Select
  • Corporate Corporate
  • Contact Us Contact Us
  • Contact Us Blog
  • Products
    • Zaggle Propel
    • Zaggle Edge
    • Zaggle Save
    • Zaggle Select
  • Company
    • About Us
    • Team
    • Careers
    • Press
    • Contact Us
  • Blog
  • Gift Card Deals
  • Corporate Solutions

  • Cart
  • Login/Sign Up
Menu
Zaggle Blog
  • Sample Page
Zaggle Blog

How technology can help deliver seamless Employee Benefits: Cashless & Paperless

Posted on January 3, 2020April 17, 2020

It may seem counterintuitive, but Indian digital payments major PhonePe is chasing growth by facilitating cash withdrawals. For this, it’s even hitch-hiking on offline retailers.

The Walmart-backed platform launched PhonePe ATM service on its app on Feb. 5. The feature allows users to collect physical cash—up to Rs1,000 ($14) a day—from a kirana (mom-and-pop) store and transfer an equivalent amount to the merchant from their PhonePe app.

Customers in 300 cities across Delhi, Mumbai, and Bengaluru can now locate nearby stores offering this facility on the PhonePe app and use the service for free. PhonePe says it aims to cover more Indian cities in the coming months.

PhonePe ATM will benefit those who don’t have ATMs in their vicinity or those in areas where ATMs frequently run dry of cash. “PhonePe ATM service will help users withdraw money within a radius of 15-20 metres, doing away with the need to travel long distances in search of a (bank) ATM,” Vivek Lohcheb, the company’s head of offline business development, told Quartz.

He adds that there is no irony in a digital wallet encouraging the use of cash. “We don’t want to increase cash circulation in the market. The fact is, 97% of commerce already happens through cash. So, with our new service, we only want to facilitate that requirement,” said Lohcheb.

The goal is to create more use-cases for existing consumers and encourage them to carry out transactions on our platform, he added.

Some experts, though, doubt if the service will be useful for existing users. “The ATM idea is purely a gimmick. Most customers using digital payments apps are digitally savvy and don’t have much requirement for physical cash,” said Ashneer Grover, CEO and co-founder of BharatPe, a Delhi-based fintech company.

More users

While kirana store owners can benefit from higher footfalls from the service, experts say the real benefit for PhonePe lies in expanding its user base, which currently stands at 185 million.

PhonePe: Key business metrics in numbers

“What PhonePe is doing is, it is familiarising more people with its digital payments platform—albeit in the garb of cash transactions. Consumers will start using the app to withdraw cash, and with time use it directly for digital transactions,” said Bala Parthasarathy, CEO and co-founder of MoneyTap, a Bengaluru-based firm offering credit.

Digital transactions in India have witnessed a tenfold increase between 2013 and 2019, but remain less common than in other BRICS countries, according to a May 2019 Reserve Bank of India report (pdf).

With slow growth in the uptake of digital transactions, digital payments platforms are left with little choice but to piggy-back on the predominant kirana stores. “Kirana stores have survived the supermarkets, big retail chains, and even e-commerce. Ironically, the bigger players including digital payment platforms and large retailers are now striving to work with the same kirana stores that they are competing with,” said Parthasarathy of MoneyTap.

Challenges remain

PhonePe’s inorganic growth strategy may give it access to more users, but this approach comes with pitfalls, according to experts.

“By tying up with kirana stores for withdrawal of cash, PhonePe is letting consumer experience go out of hand,” said Raj N Phani, founder of the Hyderabad-based fintech company, Zaggle. “The company will no longer have the advantage of overseeing and managing end-user experience. This could hurt brand PhonePe as it could face disgruntled customers.”

Scaling up the service would also pose challenges. PhonePe will have to invest heavily in educating merchants about using PhonePe ATM facility, more so in smaller cities, where digital literacy is low. “This reliance on local shop owners for facilitating cash withdrawal will put more pressure and increase PhonePe’s costs for training merchants and maintaining record-keeping systems,” said Parthasarathy.

With the new service, PhonePe has also made itself vulnerable to fraud. There could be cases where merchants and customers carry out withdrawals and dishonestly contest transactions. There is also the possibility of frivolous cases of customers collecting money and denying doing so.

Making cash available all the time at the kirana stores is also going to be a big task. For example, users not finding cash at a kirana store will end up being unhappy and waste no time in switching over to a competitor, suggested Phani.

The team at PhonePe is aware of some of these pitfalls. “To override this uncertainty and ensure a user does not return disappointed from a kirana store, we have created a tab on our app, which merchants can toggle off to show whether they have enough cash to disburse or not,” said Lohcheb.

Even if PhonePe plugs all the loopholes, the company still does not have a revenue model to monetise the service. Without revealing details, Lochebe said, “We are going to launch more value-added services for our customers and merchants in the coming months. We are experimenting and evaluating multiple revenue models to see how best we can monetise our new offerings.”

In the absence of a revenue model, it is to be seen how PhonePe makes its bet on offline retail pay off.

Source: Quartz India

admin

7 thoughts on “How technology can help deliver seamless Employee Benefits: Cashless & Paperless”

  1. Eve says:
    August 21, 2020 at 4:59 am

    Very interesting subject , appreciate it for putting up.

    Reply
  2. Vadai says:
    November 15, 2020 at 4:03 pm

    I believe I’ve never read a single article like this before. So good to discover another person with some genuine thoughts on this subject. Really.. many thanks for starting this up.

    This site is one thing that’s needed on the internet, someone with a little originality!

    Reply
  3. Dharmendra says:
    January 21, 2021 at 9:01 am

    Fine way of describing, and pleasant piece of writing to get information concerning my presentation subject

    Reply
  4. Patro says:
    January 21, 2021 at 9:01 am

    I have learn several good stuff here. Definitely value bookmarking for revisiting. I wonder how much effort you put to make the sort of magnificent informative site.

    Reply
  5. sahoo says:
    February 27, 2021 at 7:51 am

    Hi,
    Truly visiting this web page daily, absolutely obtaining pleasant experience.

    Reply
  6. Maruthi says:
    March 3, 2021 at 3:14 pm

    Good post however I was wondering how you were writing in such a perfect sense. This will make me very surprised and special sense to come to your site
    Thank you!

    Reply
  7. Ken says:
    March 18, 2021 at 4:30 pm

    Hi, the content existing in this web site are actually amazing for people experience, well, keep up the nice work.

    Reply

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recent Posts

  • 5 Key Pitfalls to Avoid for Building the Best in Your Channel Partnerships
  • Boost Employee Productivity with Expense Digitalisation
  • Effective Channel Partner Incentive Planning for the Pharma Industry
  • Going cashless to simplify employee expenses and payments
  • Tips to attract and retain the right channel partners

Recent Comments

  • Pavithra on How does Zaggle Gift Card Work?
  • Harold on How to Manage Petty Cash for Business Expenses
  • Kiara on 5 Common Mistakes in Expense Management
  • Margene on Peer to Peer Recognition Programs make Rewards and Recognition a Natural Process
  • John on Why Employee Engagement is a must have for any Organization?

Archives

  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • February 2019
  • July 2018
  • December 2017
  • November 2017

Categories

  • Uncategorized

Meta

  • Log in
  • Entries feed
  • Comments feed
  • WordPress.org
©2021 Zaggle Blog | Powered by SuperbThemes & WordPress

    Our Company

  • About Zaggle
  • Careers
  • Press
  • Partner with Us
  • Contact Us

    Customer Products

  • Gift Card Deals
  • Zaggle Cards

    Products

  • Zaggle Propel
  • Zaggle Edge
  • Zaggle Save
  • Zaggle Select

    Information

  • Grievance Policy
  • Refund Policy
  • Privacy Policy
  • Terms and Conditions
  • FAQs

    Download Zaggle App

  • no_image
Subscribe to get the best offers!

Copyright 2020 Zaggle Prepaid Ocean Services Pvt.Ltd.All rights reserved