Digital payments have spread – But have the Rural areas got covered?

Ever since digital payments have got a nudge in India post demonetization, there has been a steep rise in the acceptance of the same.

Be it the end-users or online businesses, both the sections are enjoying the benefits of an extremely secure, convenient, and quick payment method.

This method of transacting is the new obsession among the masses and is vital for the growth of the economy as a whole.

Rural India, being the sector with 83.3 crore Indians residing in it, makes up for the majority of the country’s population.

This is the reason for needing to provide push the digital payments in rural areas considerably.

Hence, the emphasis is not only on making digital payments a prominent aspect of rural areas in India but is also on increasing financial inclusion.

The pie chart above shows that 16% of people in Rural areas have adopted digital payments against 44% of the population in Urban areas having completely accepted the same.

Even though it is only 16% of the population has adopted digital payments, it will be a further push to the entire economy once Payment gateways are available across the sector.

Factors that favour Payment Gateways for Rural India

Here is the list of factors that favor Payment Gateways for Rural India, since rural sectors have advanced significantly:

• Internet Penetration in Rural India is making a way for Payment gateways’ Penetration

According to a report by livemint, India’s internet base had crossed the 500 million mark in December 2018, which signifies that there has been a considerable rise in internet usage by the rural population.

In the entire population, it turned out that 200 million are active users of internet facilities in rural areas.

In addition, recently, it was found in a report that the digital adoption is going ahead further and internet users in rural areas have gone up by 35%.

Hence, according to the estimation, there are around 251 million internet users in rural India now. This is also expected to go up to 290 million by the end of 2019.

The graph above shows how gradually internet users in Rural India have gone up, from 200 million in the early survey (2018) to 251 million in December 2018 and are expected to rise up to 290 million by end of the year 2019.

This is a clear indication of advancement in rural India, and thus, payment gateways’ penetration is only expected to serve as a much-needed inclusion.

• Small Businesses in the Rural sector

One major factor supporting Payment gateways’ inclusion in rural areas is the existence of small businesses in these areas.

With Digital wallets as well as government-initiated apps like UPI (Unified Payments Interface) solution, demand for payment gateway in rural areas has gone up considerably.

The businesses in these areas strive to find an apt means to collect payments for them.

Different payment options that payment gateway provides can help small businesses receive payments from their customers.

Besides, a small online business in the rural sector can receive payments from across the globe with a payment gateway.

Such ambitious business owners need to be encouraged by equipping them well with payment instruments, which in turn, will only help India grow.

By providing access to these businesses, payment gateways can make the functioning of the same much better.

Besides, the level of transparency, as well as security, are much higher with a payment gateway. Small businesses can grow leaps and bounds with a facility that has become an everyday routine for people residing in urban areas.

• Unbanked have become banked lately

Very recently, in a survey by the government in February 2019, it was found that 34.3 crore accounts have been opened under the Pradhan Mantri Jan Dhan Yojna (PMJDY).

Contradicting the earlier survey results in 2014 and later, this was an extreme level up for India.

In rural areas, as more people opened their bank accounts, it is more feasible for them to utilize payments method.

Furthermore, according to money & banking, banks provided 230 million debit cards to facilitate electronic payments to the masses.

• A need for pushing the economy toward being paperless

The inclusion of a payment gateway goes beyond making transactions simpler, quicker, and more convenient.

Apart from making businesses in rural areas equipped with the services that payment gateway offers, it is also crucial to make the economy more eco-friendly.

Being paperless also makes the processing of bills and other tasks more convenient as well as quick.

Scope of Payment Gateway in Rural India

Since the rural area was lagging behind, the government made efforts, which is visible in the initiative to make one-lakh villages Digital villages over the next five years with Common Service Centres (CSCs). It, being a public-private initiative, is aimed at offering excellent digital services to the villagers.

According to the Ministry of electronics and information technology, the Digital Villages initiative will initially cost over Rs420 crore ($62 million) and, along with basic internet access, will provide avenues for interactive telemedicine and educational sessions.

“The project is a public-private partnership and will be driven through the common service centers (CSCs).

With applications introduced by the government like BHIM UPI, UPI, IPPB, M-payments & NFC payments in Rural India, the scope is quite expansive. Post-demonetisation, efforts have been made not only for urban India but also for the rural part of it.

Rural India, being really an integral part of the economy, has witnessed several efforts to be included in the digital wave.

It is quite evident from the internet penetration in rural India, that mobile phones have become a success, and banking in the unbanked that the Rural sector is going to grow further successfully.

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FIVE MYTHS ABOUT POS APPLICATION – DEBUGGED!

POS terminal for a Brick & Mortar Business

POS applications are the new registers, real-time data store, secure platform, and much more for a brick and mortar business.

POS application/terminal is everything that a physical business requires for smooth transactions.

In simple words, a POS Machine/Terminal is a device that authenticates the customer by sending the cardholder’s details to the bank where his/her account is open.

It then receives the authentication status and, if the details are valid, it connects with the acquirer’s (merchant’s) bank to deposit the said amount of money in its account.

For a physical store/brick and mortar store, it is a boon since a POS machine performs several functions all at once.

All these functions/features of the POS machine make everyday functioning and storing data a lot easier.

Although a POS (Point of Sale) machine/terminal performs various functions, there are some very common misconceptions about the same, which are debugged here –

1. POS is only for billing

POS application usually comes with inventory management, account management, and several other features.

It successfully simplifies the daily business operations and manages comprehensive data in real-time. The fact is that there are many different types of POS terminals, and each carries its own strong features as well as benefits.

In short, about POS application terminals may track only accounting transactions and inventory, whereas others can be with advanced features for providing the merchant with many other benefits alongside.

Some inclusions in different POS (point of sale) terminals are interesting and vast like:

Several POS terminals also gather information with regard to sales about customers, analyze the same and present the merchant with the relevant data.

This data can be utilized to adjust/modify the products or offerings accordingly. Hence, such POS terminals are capable of doing market research; help generate reports about costs, sales, and profits of specific products, which increases the efficiency.

2. Critical nature of POS terminals in terms of operation and setup

In fact, many POS terminals are user-friendly and help the merchant with all the tasks without much hassle.

In not more than 15 minutes, any individual even with vague knowledge about computer systems and the like can successfully learn to operate a POS terminal.

Besides learning to operate as a beginner, the complete skill set can also be gained within the same time frame.

So  About POS application, it helps to simplify the merchant’s business and does not lead to any hassles. Furthermore, it helps to bring the entire data together for the merchant to find it all in one place and base the day-to-day business decisions on the same.

3. Not as simple as looking up the cash register for records of old transactions

In case of this belief, one must understand that the complexity of storing registers (of which, the pages may turn soggy, old, and worn out) is more than the technicalities of a POS machine.

A POS machine is quite easy to operate and it is even easier to look up old records the same as it needs the user to only enter the commands.

To these commands, a POS machine quickly responds with the relevant information. Hence, everything is automated, quick, and does not require space for storing.

This way, it becomes a lot better than scanning through handwritten records, which may smudge (making it difficult to read), wears out over a period, or simply create difficulty with storing.

4. POS terminals are expensive and need high-speed internet

In actuality, POS terminals are not very expensive, and there are rather “free of cost” options available. In making a return on investments more efficient, POS machine plays an extremely crucial role.

It is also of utmost importance to note that a POS machine can run with or without the internet. Having both options’ availability makes it adaptable to all kinds of business environments.

In the case of a multi-outlet or a chain of business, the internet operates the same from the head office portal (cloud portal). This is supported via basic 2G or 3G internet speed on the basis of POS hardware configuration.

Even if the internet connection is lost in between an ongoing process, the data will not go anywhere.

The app automatically switches to offline mode and the entire data is saved in the device memory. Hence, on reconnecting the device to the internet, the entire data syncs and is updated with the cloud.

5. POS terminals are generic and all are almost the same

There being multiple varieties of POS terminals, industry-specific systems exist. This implies that the POS machine specific to the day-to-day major operations can be utilized by every industry.

It makes it more feasible for the specific outlet to carry out its operations more efficiently.

There are several other aspects of POS terminals that can be understood and for that, it will be helpful to not base the traits/characteristics of the same on the certain generic criteria.

In order to opt for the correct POS system, every merchant needs to understand the type that fits its needs based on everyday operations.

This is an extremely important point to note that the right POS system will provide the merchant with a customizable, robust, and flexible arrangement to help the business progress.

Banking practices spread vigorously across the nation after Demonetisation

In today’s world, which is gripped by digitization, India witnessed a sharp inclination toward banking and e-payments in November 2016. It was the effect of a cash crunch after the ban of INR 500 and INR 1000 currency notes (demonetization) that more and more people started opting for bank accounts. This faith in bank accounts triggered further faith in e-payments. Besides, the government began pouring several perks and security measures for the ones opting for digital/e-payments. Eventually, this all led to “banking the unbanked” and the majority started shifting to digital methods of making transactions.

This was the digital wave, which swept away the undying devotion to the cash-oriented method of making payments in India. The same is quite evident in a finding, which reveals that India has gone up by more than 50% in terms of indulging in digital transactions.

Although, it took time for the country to be in terms of the new technology of making payments via digital platforms. Gradually, there has been a steep rise in the number of people (rural and urban areas) shifting to online payments in the country, all thanks to the awareness and perks offered by govt. On the contrary, advancing technology at such a rapid rate does make digital methods of payment more vulnerable to fraud simultaneously for which there are fraud prevention practices.

Fraud Prevention Practices are taking a Toll on Fraud Schemes

With the rise in the complexity of fraud schemes, there is a simultaneous rise in the ways to combat the same. This implies that “minimizing potential frauds” is as imperative as bringing innovation in the digital sector. It is the same technology that brings innovation, is changing payments’ mechanism for the better and, is also continuously introducing ways to combat digital payments’ related frauds. Having mentioned that, let’s take a look at some of the many ways in which technology is keeping fraud-related interventions at bay-

• Behavioral Analytics helps to monitor navigation techniques and other aspects of a user’s online behavior. With this technology, it becomes convenient to understand any such activity, which indicates fraud or suspicion.
• Knowledge-based Authentication implies a series of questions with answers to each typed and saved by the user. In case any of the answers typed is incorrect, it immediately takes the individual attempting access to the payment out of the platform.
• Password tokens are the OTPs (Time only passwords), which give the user a one-time password on their device which expires as soon as the allowed time-limit of using it is crossed.
• Automated Analysis tools are fraud analysis tools, which identify fraud attempts on time. Solution providers tend to provide real-time transaction screening, third-party screening, and compliance solutions.
• The internal audit function is required to keep a regular check. A regular internal audit helps to remain one step ahead of the fraudsters and conclusively, to combat maximum fraud.

Besides, it is imperative to provide enough education from the banks as well as the service provider’s end about fraud prevention measures. Online banking is beneficial for customers/merchants for the convenience and banks for lower costs. As fraud affects a business’s customer relationship quality and customer loyalty, an effective set of preventive measures are a must. Since technology is rapidly bringing innovative online payment methods, frauds are also evidently on the rise. Although, the good news is that there are fraud-combating effective technologies to adopt.

Growing Banking practices

It is without a doubt that the banking practices are growing by leaps and bounds in India. It is more so ever since demonetization. With the help of various government initiatives to make people understand the benefits of banking, the majority of the people in the country have shifted toward digital methods of making payments. Be it shopping online, or at a brick and mortar store, masses have drastically shifted toward opting for making payments digitally instead of in cash. According to the Economic Times, here is how online banking has made its way into the ecosystem-

The above pie chart shows that 51% of Indians use online banking channels, whereas 26% of Indian customers prefer to access services via their bank’s website and the same number would prefer to use a mobile app rather than talk to a human agent.

Source: Economic Times

This information reveals that despite the banking fraud rearing its ugly head now and then, the preventive measures and fraud-combating ways/technologies are impactful. The impact/effect of which is quite evident in the data above that shows a growing number of online banking practices amongst the masses.

Some useful tips

After all, that is taking place to fix banking fraud, taking note of some useful tips can help one be tremendously safe from getting caught up in a difficult scenario/position:

Overall, as the banking sector has shifted drastically toward being digital, it is of utmost importance that the masses take preventive measures to keep net banking/digital frauds at bay. Besides, one must also be sure to be mindful of any suspicious activity, query, or misguidance. Immediate action in case of such scenarios will help one keep reaping the benefits that online banking/digital payments have to offer in today’s fast-paced digital ecosystem.

Digital Payments increased with Demonetization

In November 2016, India was struck by demonetization, which was when the country witnessed maximum digital transactions.

Demonetization led the country to face a liquidity crunch, which had a sudden impact on the masses and businesses simultaneously.

For the people of the country, cash was the most convenient mode of transaction and the belief on the same was hard to shake.

Anyhow, demonetization led to a ban on INR 500 and INR 1000 currency notes. Many businesses and the general public were left with not many options except for standing outside ATMs in long queues.

Although the digital mode of transactions like cards and digital wallets were prevalent, many small businesses lacked the basic infrastructure for carrying out transactions.

This led to the businesses choking since the shortage of the medium of payments led to fewer sales or sales on credit.

Hence, the situation called for something to be done on an immediate basis and that was to increase the strength of digital transactions.

It was one rarest of the rare times when digital transactions were demanded at the rate of several transactions per minute across the nation.

During this challenging phase, most of the digital payment providers could not match the demand since they were not ready for a situation as grueling as this.

An immense scenario like this was taken care of by Lyra Network, India as it understood the gruesome need of providing the masses with a robust medium to keep making digital transactions.

How did Lyra help its Clients during Demonetization?

Lyra’s payment infrastructure was also a part of the struggle during demonetization since several transactions led to huge pressure on the payments channel.

During this phase, a spur in the volumes of transactions led to the crashing of various platforms overnight.

However, despite high demands for online transactions, Lyra’s system kept providing continuous support to the public without fail, all thanks to its technological edge!

This, being a part of the ‘Digital India’ initiative, gave a further boost to cashless transactions and as a result, we have witnessed a shift from the traditional way of making payments to technology-induced payment platforms.

Nevertheless, it was extremely difficult for the masses to psychologically accept and adapt to the scenario of digital payments being the favored option for making and receiving payments.

However, the uninterrupted provision of Lyra’s safe, convenient, and quick services for continuing the transactions made small businesses deepen their trust in digital payments and particularly in Lyra.

Lyra is highly supportive of Omni-channel businesses and that is what has helped small businesses attain their objectives of safe, quick, and uninterrupted payments in all kinds of scenarios.

Hence, during demonetization:

• Lyra Network continued its operations in full swing with its active data recovery centers in Mumbai and Bangalore.
• Strengthened all the partnered leading banks to provide an undue service to all the associated businesses through Lyra’s payment infrastructure.
• Apart from the banks, Lyra has dedicated connectivity with the telecoms, and it maintained continuous follow-up to inflict processing of smooth transactions.
• Technically, the configuration from Lyra’s end was an enhanced one, which made the flow of transactions smooth enough during high utilization of the payment channels.

So, what all does Lyra’s E-POS offer?

Since Lyra has established itself as a major player in the Fintech industry, Lyra’s E-POS is one of the exquisite services that have it all available in a single application for merchants to carry out smooth transactions.

E-POS is Lyra’s one of the online payment services that are available as an application on the mobile phone of the merchant.

It is equipped with an advanced method to receive payments from mobile phones with several benefits. Adding on to the benefits, Lyra’s E-POS is available for downloading and is easy to operate with convenient navigation.

It suffices the needs of an Omni-channel business, as it is always available in the merchant’s mobile phone for door-to-door deliveries.

The application generates a payment link, which can be shared with the customer via a QR code or any communication channel (Social media, e-mail, SMS) to make on-the-spot payments at ease.

It allows the customer to make payments from Cards, Net Banking, Wallets, and UPI.

This all sums up the benefits that are more precisely stated as:

• Seamless flow of transactions
  • Reduction in the operational cost
  • Cashless transactions
  • No need for a separate machine
  • Maximum security with reliable application
  • Fraud & Chargeback minimization
  • Quick transfer of transaction each time

1 million POS terminals and 70,000 online shops

Lyra, with its innovative payment management tools and secure infrastructure, has been able to address the concern of cybersecurity also efficiently.

Lyra Network manages the flow of over 1 million POS terminals and 70,000 online shops and is currently spreading its reach in countries like Nepal, Bhutan, Sri Lanka, Bangladesh, and so on.

It also caters to the payment-related requirements of the organizations. Besides, its platform is well-equipped to ensure security in payment processing across a plethora of payment modes including credit and debit cards, net banking, and e-wallets. Currently, Lyra is processing 1.5 million successful transactions daily.

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Payment Gateways are being embraced

Over a period, payment gateways have gained immense popularity among the masses as they provide basic ease, convenience, and security with transactions.

Lately, so much is happening in favor of the online payments that people are embracing payment gateway like never before:

Number 1, majorly, is the favorable regulatory environment, which has played an integral role.

After having observed the elevating status of online payments, authoritative bodies/governments have inflicted several factors to keep up with the pacing technology and dynamic customer outlook.

To do justice to the dynamism of the online payments industry, the concerned bodies keep introducing new decisions.

Policies like KYC relaxation for small transactions, elimination of 2-factor authentications, and promotion of cashless transactions have provided a further nudge to digital payments.

Number 2, Enhanced customer experience leads to more satisfied customers, and hence, makes the customers inclined to the same in particular.

Ever since e-commerce platforms have become popular in India, people have significantly become frequent online shoppers.

In making online shopping popular, exceptional customer experience undoubtedly receives a major chunk of the credit.

There is a whole lot of convenience in placing the order online, receiving it while sitting at home, and getting it exchanged/returned.

Payment gateways have only added to the advantages with seamless transaction flow, exceptional security, and hassle-free payments.

Hence, enhanced customer satisfaction/experience is another important factor for the enhanced functioning of the payment gateway.

Number 3, Growth in the e-commerce segment lately has picked payment gateway’s growth parallel to its own.

Since e-commerce platforms make use of payment gateway for providing their customers with a method of making payments that are quick, convenient, and safe, they play an imperative role.

Number 4, India is becoming Digital, which is visible in the recent progress of the country in terms of shifting to digital methods of payment.

It has led to an increase in the demand for better opportunities consequently. In terms of mobile subscriptions, India has come out ranking second with around 1 billion mobile subscriptions.

Around 240 million use smartphones and it is predicted that it will rise to around 520 million by 2020. Similarly, as 3G 4G penetration has increased considerably, the number of internet users is also predicted to double to 650 million by 2020.

As the demands of the country are increasing for digital payments, it is but obvious that the regulatory bodies and concerned industries will go on to rapidly meet the concerns similarly.

According to the Future Market Insights (FMI) report, the global online payment gateway market is expected to witness a CAGR of 10.3% from 2018 to 2028.

The market is expected to reach a valuation of US$ 191.7 Billion by the end of the forecast period rising from a valuation of $ 65.5 Billion in 2017

In what ways has the Payment Gateway become Accessible to End-Users and Efficient for Merchants specifically:

As dynamism has progressed through d the advancement of the f online payments sector, it is obvious that its accessibility to the end-users and efficiency for merchants have both gone up.

Take a look below at how the strong growth trajectory has turned it all for the better:

For end-users,

Apart from the evolving (and progressing) nature of payment gateways, end-users are enjoying the benefits in several other ways:

• With increased ease of doing payments
• Access to a user-friendly interface and navigation
• Enabling of tracker for all payments
• Much more ease with the quicker refunds on cancellation of order/purchase

Now, let’s see how the aforementioned benefits are helping how many of the population approximately-

For merchants,

Since payment gateways are progressing majorly to provide added benefits to the merchants, below are the main areas that have developed to increase the efficiency:

• Increased security with transactions

With PCI-DSS compliant servers, the transactions of the merchants are successfully compliant with the security that a bank can deliver to the masses.

Furthermore, Lyra Payment gateway recently achieved the title of being EMV 3D S 2.1. These security measures have, consequently, increased payment gateways’ efficiency considerably.

• Less time & effort spent

Bringing down the tedious tasks of preparing payments and managing payment issues, payment gateways have significantly brought down the level of time & efforts taken earlier.

A payment gateway does not require anything since it is equipped with a by-default setting. This setting helps with the processing of continuous payments and reduces the cost alongside.

• Quicker and smoother transactions

Any advancement or progress in technology happens to make the circumstances better than before. Now, the provisions, like KYC, one-click payments, wallets, quick onboarding, and so many other features have combined to make transactions even quicker for merchants.

Their automated ways and systematically designed platforms lead to an increase in the conversion rates for furthering sales.

Lyra’s Payment Gateway:

Lyra Payment Gateway, the online solution powered by Lyra, is devised for making the customers’ online payments path uniform with each transaction.

Featuring an innovative payment platform, Lyra’s payment gateway provides a high level of security. It offers several features namely, hassle-free, secure, convenient, and smooth flow of transactions.

Committing an enhanced success rate to the merchants, widens the arena of selling as well as comfort. Besides, it has the backing of French technical support, which ensures payment methods like wallet payments, multi-card payments, and split payments.

Supplementing the provisions is the zero setup fee and no maintenance fee to aid the merchants with a cost-effective solution.

Payment Methods:

• Manual Payment
• Payment via e-mail and SMS
• EMI Payment Options
• Split Payment
• 1-Click-check-out
• Multi-card payments
• Debit, Credit card, and net banking options
• Wallet payments

Features of Lyra Payment Gateway:

• Certified with Visa and MasterCard, Amex, and Diners.
• Provides proven real-time Card authentication solution.
• Renders simple merchant integration.
• Offers multi-platform support.
• Enables the bank to view 3DS-related communication in real-time using the Lyra web portal.
• Provides the issuer ACS URL immediately on the portal whenever ACS is down.

Benefits of Lyra Payment Gateway:

• Higher success rate and conversion rate
• Maximum security with 3DS transactions
• Seamless integration
• Fraud and Chargeback minimization
• Maintains transaction integrity