Digital payment growth has been on the rise in recent years, with more and more people opting for digital payment instead of cash. The convenience of digital payments and increased security measures have made it a popular choice among consumers and businesses.
The advent of user-friendly digital solutions has undoubtedly brought about a greater degree of convenience and efficiency to our daily lives, as well as contributed to the promotion of financial inclusion and an overall boost to the economy. Particularly in light of the ongoing pandemic, the implementation of contactless digital payment solutions like BHIM-UPI has proven to be crucial in facilitating necessary social distancing measures while providing critical support to small businesses.
In today’s world, it’s essential for businesses of all kinds, whether street vendors or online brands, to provide digital payment options to their customers. It’s vital to stay up to date with payment trends to meet market demands. The digital payment statistics for 2023 can guide you in creating effective payment systems for your business. As per Forbes, e-commerce statics – 20.8% of retail purchases are expected to take place online in 2023 of $6.3 trillion, and by 2026 – 24% of $8.1 trillion retail purchases are expected to occur online.
Key benefits of using digital payments include:
Instant and convenient mode of payment: Digital modes such as UPI and IMPS allow fast transfer of money to the beneficiary account, unlike cash. Moreover, using the UPI mode, one can effect a digital transaction via mobile phone using a mobile number or an easy-to-remember virtual payment address (email-like address). The interoperability of banks in the case of UPI payments has facilitated ease of payments.
Enhanced financial inclusion: You can access your accounts anytime, anywhere, with digital payments. This makes it easy to receive payments and make payments using your phone. No more wasting time and money traveling to a physical bank outlet. Now you can conveniently access your bank account digitally and enjoy the benefits of being part of the formal banking system and becoming financially included. Using biometric payments such as Facial Payments and Pay by Voice has the potential to revolutionize the way we make transactions.
Leak Proof Reconciliation: Real-time data availability helps small retail vendors to reconcile end-of-day business regularly and helps them to plan their re-payments.
Increased transparency in the government system: Previously, cash payments often suffered from “leakage,” resulting in incomplete payments reaching the intended recipient. However, current digital payment methods directly transfer benefits to the beneficiary’s account, ensuring all funds are received in full.
Improved speed and timely delivery: Digital payments can be completed instantly, regardless of the location of the sender and receiver, unlike cash payments which rely on the speed of the carrier.
National Electronic Toll Collection (NETC) system: The NETC system allows customers to pay electronically at toll plazas without stopping using Radio Frequency Identification technology.
Bharat Bill Payment System: Bharat Bill Payment System (BBPS) provides an interoperable and easily accessible bill payment service to consumers via multiple channels like Internet banking, mobile banking, mobile apps, etc. Customers can make easy bill payments anytime, anywhere, through BBPS.
Enhanced Credit Access: Digital payments have an advantage over cash payments as they create a financial record for the user, which can improve their access to formal financial services, which include credit. Banks and other lending institutions can utilize digital transaction histories to make cashflow-based lending decisions for retail lending and lending to businesses, including small businesses that may need help getting credit without verifiable cashflows.
Safe and secure: Individuals who receive cash payments frequently encounter the inconvenience of traveling long distances to retrieve their funds. Unfortunately, this can make them more vulnerable to theft and other security risks. Digital payments across India are protected, as multiple authentication levels are required for transactions.
To conclude, the rise of digital payment adoption has led to a significant shift in the payment landscape that helps the digital economy grow. Consumers now have more options than ever before to make purchases securely and conveniently, and businesses have the opportunity to process payments with increased security and savings. Digital payment growth benefits consumers, businesses, and the economy in ways that traditional payment methods cannot match.
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