I’ve written several times about how the Chinese, through apps like WeChat, can pay for almost anything with their smartphones (1, 2, 3, 4, 5). One of the things that have helped make digital payments ubiquitous in China is the use of QR codes. All it takes to accept a digital payment is a QR code that the buyer can scan with their phone. It’s cheap and easy and just about every merchant—at least in urban areas—participates.
Paytm is bringing similar functionality to India. You can get an Uber ride, buy a railway ticket, send money to a friend, pay utility bills, and all the other things you’d expect from a digital cash service. India is still predominately a cash-centric society so, unlike China, digital payments has not replaced cash. Paytm has about 400 million users out of the 600 million Internet users but there’s plenty of room for growth because another 800 million Indians have never been online. Paytm is moving in the same direction as WeChat as they add new services to their app.
The driving force behind Paytm is Vijay Shekhar Sharma, who is making plans to bring Paytm to the United States. The US is far behind in digital payments and represents a huge market for Paytm and other services. Of course, Apple and Google have been trying to bring this functionality to the US for the past few years but have met some resistance. Still, Apple is making headway and the market does seem to be developing. It will be interesting to see what happens.
I, of course, would be delighted if everyone would start accepting Apple Pay but perhaps a QR-code-based system can break through merchant reluctance.