Advertisment

Young micro merchants prefer e-payment over cash

A new MasterCard study of micro merchants in India indicates that young merchants in the age group of 35-45 are most likely to adopt e-payment systems.

author-image
Soma Tah
New Update
ID

BANGALORE, INDIA: A new MasterCard study of micro merchants in India indicates that young merchants in the age group of 35-45 are most likely to adopt e-payment systems.

Advertisment

The MasterCard study interviewed micro merchants across India with a view to understand the market potential, key barriers to adoption of non-cash modes of payment and opportunities for enabling a less-cash society. The study estimates the potential market size to be more than Rs 23,000 crore weekly.

The study identifies young merchants owning businesses (6 to 20 employees), primarily in auto accessories, building fittings, medical, private cabs, and food & beverage sectors based across Delhi, Mumbai, Chennai and Bareilly as high potential segments for adopting new technology and moving to a non-cash payment system.

Merchants cited potential increase in revenue (46 percent) as a strong driver for trials, followed by increased business efficiency (31 percent) and enhanced shop image (30 percent).

Advertisment

Porush Singh, Country Corporate Officer, India and Division President, South Asia, MasterCard, said, “As India moves towards digitization, we firmly believe that the country’s young population will be the drivers of technology adoption and transformation of the payments landscape, and the MasterCard study mirrors that belief.”

Concerns on cash-driven business:

Merchants also acknowledged safety concerns and operational concerns related to a cash-driven business, with one-third (33 percent) admitting the need for presence of self or family member at the store to avoid pilferage.

Advertisment

More than a quarter (29 percent) also agreed that they face operational efficiency issues related to cash such as time and effort to tally expenses and profits daily, and effort required to keep record of transactions. Close to a quarter of merchants (24 percent) admit to having lost customers due to inability to accept card payments.

Eagerness to adopt non-cash methods of payment

The report finds that merchants who are familiar with and personally own e-payment formats showed a higher willingness to consider adopting them for business (70 percent), compared to merchants who are unaware of e-payment methods (8 percent) or are aware but have never used it (14 percent). This indicates a need to educate merchants about the benefits of adopting non-cash methods of payment.

Advertisment

The report identifies the number of merchants most inclined to trials of e-payments at 10 percent, that is, almost 5 million of the total 59.16 million known universe of micro merchants.

smb tech-news startup