032 033 VIEWPOINTS What the World Can Learn As India’s cash supply tightened, payment card usage increased from a Billion-People Economy exponentially and digital payments initiated by mobile devices shot up. Going Cashless There are more than 920 million payment cards issued in India, but By Matt Dill the vast majority had been dormant SVP, Innovation & Strategic Partnerships, Visa or used primarily to withdraw cash at bank machines (MediaNama). This all changed on the night of November The East is becoming a hotbed for 12, 2016, when Central Bank circular 247 took 500 and 1,000 rupee notes digital innovation and economic out of circulation. There have been experimentation on a breadth and scale terrible stories of cash-crunched small businesses caught in the middle that is unprecedented in the West. and incredible disruption to daily life (as captured eloquently by our Mumbai sign writer), but out of the We could lean back and say this is the turmoil has risen a large-scale digital most large-scale ambitious swing to transformation compressed down % digital payments ever undertaken, but from decades to days. oddly enough we’ve been here once The hand-rendered sign hanging of the world’s most closely watched network with the end goal of plastic Daily trade in the world’s most 23 before—in China. Another 1 billion+ haphazardly above the bank digital currency experiments. cards in the pockets of one-third of populous nation continues, of consumer population weaned from branch entrance in Mumbai says, the world’s population. His real vision course. Cash is still a significant part is the usage of contactless cash is moving aggressively toward payments via phone in India. a potent mix of electronic payments “You can smash, mash, crash, and What happens when cash goes away? was a global network that connects of commerce, but tens of millions of trash, but there is still no cash.” It’s a The answer, it turns out, isn’t that hard buyers and sellers anywhere and payment cards have been activated. and mobile-first experiences. scribbled reminder of India’s massive to imagine. It’s happening around the moves payments around the world at Point-of-sale terminals have begun Paytm, following a global regulatory demonetization program, which globe—and particularly in Asia—at the speed of light. He was spot on. popping up at merchants of all trend of institutionalizing payments to More and more, the East is becoming was initiated by the Narendra Modi an unprecedented pace, due to the sizes. Mobile phone-based payment protect against systemic risk. Payment a hotbed for digital innovation government in November 2016 and proliferation of mobile. applications, which were built in the networks like Visa, MasterCard and and economic experimentation took 86% of paper currency out of cloud largely for online commerce, are RuPay are aligning around standards on a breadth and scale that is circulation in just four hours. Digital currency got an early start in returning to terra firma and providing to facilitate the movement of value unprecedented in the West. Where East While demonetization highlighted the West in the 1960s with the early % Indian consumers with phone-first at the “speed of light,” as imagined meets West, digital-first experiences the entrepreneurial ability of roughly marriage of mainframe payment payment at retail locations. by Hock. India will soon introduce are leapfrogging infrastructure and 1.3 billion Indians to just “work it processing platforms and the initiation 86 a new merchant payment system delivering electronic payments out” with a bit of wry humor, it also of open-loop payment instruments. The Indian government has called IndiaQR, a scannable bar code everywhere you want to be. jumpstarted what has become one Visa’s founder, Dee Hock, didn’t build of paper currency was taken out of accelerated “payment bank” licenses for mobile devices, donated to India’s Visa into the world’s largest payment circulation in just four hours in India. for mobile wallet applications like payments industry by Visa.