People in India are swapping cold hard cash for digital wallets.
Because they don’t really have a choice.
After the withdrawal of Rs 500 and Rs 1,000 denomination currency notes earlier this week for anti-corruption measures, people with the means to are now turning to cashless solutions like mobile wallet apps like Paytm, Ola Money, and Freecharge, as Mashable reports.
The companies have been taking up advertising real estate with full-page ads in national dailies to promote their services – and people are responding in crazy numbers.
Yesterday, according to Mashable, Ola Money said it experienced a 1,500 per cent increase in wallet recharges (the transferring of money from a bank account to the digital wallet).
Meanwhile, Paytm said it saw a 435 per cent upward spike in traffic as “millions” of people used its app. The company also experienced a 200 per cent increase in app download numbers and a 250 per cent surge in overall transactions and transaction value.
This was heightened because banks were closed in India yesterday. ATMs were also down and will be until Friday.
Not to mention, most e-commerce businesses in India temporarily restricted the cash-on-delivery option.
Just in time, today Snapdeal-owned Freecharge launched a new feature to its cashless wallet called “Wallet on Delivery” that allows users to pay for their purchases on Snapdeal when they are delivered using their FreeCharge wallet.
As Mashable reports, today Paytm – who currently has partnerships with over 2 million offline merchants who accept payments via Paytm cash – announced plans to hire over 10,000 people to expand touch points where users can pay cash to top up their mobile wallets.
While the paper cash move is designed to tackle corruption and tax evasion, many poorer artisans and traders who rely on the cash economy will feel the hit.
The shift to cashless solutions is a big one for the region, with hundreds of millions of residents still living off of cash and with no bank accounts.
But the digital wallet tech companies are on a mission to change this for them – and the rest of the world. With most of India’s cash becoming useless, it looks like its residents will soon have no choice.
Image: Associated Press via Mashable
In the meantime, long, chaotic lines formed outside Indian banks when they re-opened Thursday, filled with people wanting to exchange their now discontinued notes for new Rs 2,000 and Rs 500 notes. Currently, the government is forbidding people from exchanging more than Rs 4,000 ($60) per day of their old currency for new bills.
In other news, the reduction of paper cash isn’t the only way the country is (indirectly) saving trees; earlier this year, India announced it would invest $6 billion to create new rain forests.
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