<div><strong>Vishal Krishna</strong><br> </div><div>Imagine walking into a retail store and paying through an app, which is recognised by the point of sale system of the retailer and which allows the shopper to instantly check out. Imagine, after morning exercise, a citizen visits his local tea stall and pays through the app. Or imagine this, a citizen wants to open a bank account and goes to the kirana store to do so. The grocer verifies the person with an iris and finger print scanner linked to the Aadhar database and the mobile number becomes the defacto account. Companies like EzeTap, Momoe, NovoPay, MobiKwik and others will eventually be coming together to make virtual banking a reality. Momoe is engaging all local merchants to accept virtual cash. EzeTap has integrated PoS machines to recognise digital wallets and Novo Pay allows customers to open bank accounts with mobile phones and pay virtual cash to merchants. </div><div> </div><div>"Its no doubt that banking is going mobile. The numbers are there and banking will be more inclusive because of smart phones," says Vijay Shekhar Sharma, founder and Chairman of PayTM.</div><div> </div><div>The payments industry, according to IAMAI, is worth $127 billion in the country. There are 17 million credit cards and less than 200 million bank accounts in the country. The mobile payments industry is very minuscule, say Rs 300 crore, but has tremendous potential because of the rise of smart phone sales in this country. Gartner predicts that India will have 500 million phones being sold by the year 2018. Currently PayTM and Mobikwik dominate the payments space. While these are just linked to bill payments they hope to complete the entire loop of banking, which is to take deposits, allow payments to offline merchants and to increase consumption.</div><div> </div><div>"The payments industry needs to sync with Aadhar to make it more effective and scalable," says Srikanth Nadhamuni, Chairman of Novopay.</div><div> </div><div>The problem today is the rate of growth of the economy and the rate at which jobs are being created and the loans being disbursed to fuel the economy. With banks still being tight lipped about the Indian economy's fundamentals, only time will tell if consumption will be large enough to correlate to smart phone usage. Just 100 million people consuming on smart phones will drive valuations of startups, which is a good thing. Whether it is going to usher in a change in including 900 million more people in the consumption boom, is a different story all together. However, for a technocrat this is the best time to build a technology stack for Indian consumer banking.</div><div> </div>
