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With Prime Minister Narendra Modi launching a surprise assault on black money this week by demonetising Rs. 500 and Rs. 1,000 notes, Internet-enabled services in India have been the big beneficiaries. We already know that mobile wallets have been celebrating, and wallet signups have surged.
With e-commerce companies putting the brakes on cash-on-delivery (CoD) orders, wallets are also rushing to fill the gap with wallet on delivery services. They're not the only ones to benefit however, as many local services, such as movie tickets, grocery deliveries, and taxis are also seeing a spike in usage.
For example, taxi aggregator Ola observed an “over 1500 per cent increase in recharges” on its digital wallet system, Ola Money. The crazy uptick took place between 8:30pm and midnight on November 8, the company claims, right after PM Modi made the announcement. It makes sense if you don't want to spend cash on an auto or a taxi, and would rather hold on to your notes for when you really need them.
It’s not all being spent on cab rides itself, as Ola Money is compatible with other offline and online merchants, and could be used to top up your Mumbai Metro prepaid card, or even pay for your movie tickets on BookMyShow.
BookMyShow is another company that saw a spike, because you really don't want to risk not having change when you're buying the tickets - booking online saves your cash. In a statement made to Gadgets 360, marketing and business intelligence VP Marzdi Kalianiwala said it will “continue to be aggressive on offers and discounts for transactions through BookMyShow's MyWallet”, more so for new users in light of recent events, though he could not share the specific details.
But if entertainment gets a boost, then the essentials are even more likely to be affected. Local grocery stores aren't accepting Rs. 500 or Rs. 1000 notes, so picking up fruits and vegetables becomes a little difficult. That's provided a helpful boost to grocery delivery services such as Grofers. Although the company would not comment on this, a source in Grofers told Gadgets 360 that it has seen a significant uptick in the use of digital payment options since November 8.
At the same time, it seems companies are overestimating the permanence of such activity. In a statement, Ola Money head Pallav Singh said, “This move marks the beginning of a significant step towards a cashless economy and Ola Money is at the forefront of our vision of a Digital India.”
Even Kalianiwala said BookMyShow believes PM Modi’s steps will help Indians “collectively move faster towards becoming a cashless economy”. That seems a bit of a stretch, considering a new Rs. 500 note and a new denomination of Rs. 2000 are on their way, and on Thursday it was confirmed that new Rs. 1000 notes will ultimately be issued as well.
Uber India president Amit Jain remarked: “It is a bold move from a cash economy to a digital-first one. We anticipate it will have long-term benefits for the economy, ushering in transparency and a faster adoption of digital payments.”
Jain also called on the government and RBI to do away with two-factor authentication on low-value transactions, which would streamline the process for paying online. In the current landscape, Indian users paying via a credit/ debit card have to jump through two steps – first the card’s CVV, and then a set password or a one-time password (OTP).