Ecommerce to aid growth of online payment systems, says PwC study

PricewaterhouseCoopers (PwC) has come out with a study on electronic payments, which has made several observations on the progress and future of online payments. The study observes that upcoming markets (including ecommerce) have the potential to grow at a faster pace than conventional markets with the help of online payment mechanisms.

Having realised the importance of their own payment system, all leading ecommerce companies including Flipkart, Amazon and Shopclues are in the process of (or already posses) getting their own mobile wallet or payment gateway. Companies are realising that in order to win customer trust, a secure payment gateway is primary. Having its own payment system has innumerable benefits to a company:

• Reduced expenses

• Reduced incidence of CoD transactions,

• Increased security in payments,

• Quicker transactions and so on.

Technology to play key role

The study notes that transaction-only banks will depend on technology to ensure a smooth payment process.

“Given the underlying infrastructural issues in emerging markets, there needs to be a focus on developing the infrastructure both for issuing and acceptance of payments products and instruments. Alternate payment instruments and modes like mobile wallets, virtual cards and accounts, social media and contactless payments are gaining traction for specific use cases, especially the unbanked customer base, driven by technology, customer needs and declining margin,” notes Vivek Belgavi, FinTech Leader at PwC.

By 2030, modern payment will have overtaken conventional banking systems, propelled by technology, ecommerce, changing customer expectations and global demographics, notes the study.

Ecommerce companies are rushing to secure their place in the secure payment framework. With the growth set to shoot upwards, and the benefits aplenty, we believe that those lagging behind need to buck up and establish their payment network and make best use of the cliamte.