An Empirical Study on Future of Mobile - Wallets in India : A Gateway for Cashless Payments

Abstract

After the demonetization in India by the Union Government on Nov 9, 2016, mobile-wallets (m-wallets), as pre-paid purchase instruments (PPI) would play a vital role to boost efforts towards cashless payments and financial inclusion in the Indian economy. All the bank account holders with debit cards and smart phones will be the most probable users of m-wallets post demonetization. Therefore, this research paper attempted to explore the future of m- wallets in India by accessing the intent of existing debit card users to use m - wallets for cashless payments. Extensive literature review and personal interviews of senior professionals from banking and telecom industries were conducted to find the parameters to explore usage intentions of m - wallets based on adaption readiness and perceived risk for m - wallets. A survey of 445 such customers, who used debit cards for cashless payments, was conducted in the city of Lucknow during December 2016, post demonetization. Questions were asked to test the awareness level for m-wallets and about their experience while using debit cards to understand their probable behavior for using m-wallets in India. By using discriminant analysis, a model was derived, which suggested that debit card users who were upto 45 years of age had fewer handling problems related to debit cards and were more inclined towards adopting m-wallets post demonetization in India. This information has vital implications for policy makers and service providers while strategizing for cashless payments. The post demonetization environment for cashless payment is conducive for m-wallets in India, opening ample business opportunities for service providers by providing secured and quality day to day cashless payment facility for customers in the future.