Consider a situation when a street hawker / cable-wallah / door-to-door salesperson / kabaadiwala / Sabjiwallah / kriyanawallah (mom and pop store), any such doorstep business comes to your door & you don’t have cash for payment. All you have left is a credit or debit card but ..sorry no cash. The business person,surprisingly, says that is Ok ..& then swings out his new Andriod/iphone smart phone along with a small square device with a swiping facility. He plugs that device into the phone’s jack or usb socket and says confidently with a smile..Don’t worry we accept credit cards & debit cards as well…
Now this is something for the small businesses. How about a device which can be attached to the mobile phone & enables the small business owner to accept credit / debit cards?
Well a company called square has already developed such a device which could be a big boon for small business owners to conduct financial transactions. They have developed a card reader, that is small enough to carry in your pocket & advanced enough to do those credit / debit card transactions.
Square’s pricing structure seems simple at a per transaction charge of 2.75 % & what’s more ..they are giving the device for FREE !! Incredible technology which can do wonders in the coming years ..Isn’t it ?
Visa has developed a single click point of sale payments mechanism for online payments. The interesting fact is that it will handle both Visa & Non-Visa payments. The visa press release though doesn’t mention in detail on how will the system work, but states that the users can shop “by simply entering an email address, alias or online ID and password, instead of a billing address, account number and expiration date”. Such a system is bound be hit by ever skeptic customers (specially Indians ) who are varied of going for any new mechanism for online transactions involving their hard earned rokda i.e. money.
In term of competition I feel there are already so many players in this field e.g. Amazon’s 1-click and PayPal services, where Paypal already has more than 98 million active users (though it charges a premium rate of 30 cents + a percentage rate per transaction) . I guess adoption by both merchants & customers is the biggest success attribute here.
From an Indian market perspective the credit/debit card subscriptions are high but card usage is relatively low. However the exploding mobile revolution with burgeoning mobile users touching 770 Million, the perfect channel of growth for payment industry is the cellular medium. The interesting fact is that the most important payments mechanism i.e. mobile payments will be catered later by VISA. It will however be using the NFC (near field communication) technology.
Airtel being another stakeholder in this industry has already launched Airtel Money – a scheme where mobile payments services are provided by the service provider. Considering NFC being the upcoming technology in this arena & widely talk about the next in thing when most of the latest mobile phones will have NFC enabled chips, the player who captures the opportunity first & throws it open to the Indian market will have a chance to catapult great growth figures in the payment industry.