Coronavirus has consumed not only lives but also many jobs and almost all the businesses have faced loss in revenue as a large section of the market is left with no money. To counter the revenue crises and improve the stability in the prevailing situation businesses have come up with yet another offer for the customers because of which their revenue has seen a spike. Credit card payment app CRED said in its June 2020 newsletter that apart from Mumbai, other geographies saw a rise in spending by affluent individuals.
‘Razor pay’, online payment software, also saw an improvement in spending in some segments, led by logistics, healthcare, and real estate. Still, as the demand scenario is improving, the overall revenue in the digital payments market is likely to drop this year as the value of transactions has been falling. This is especially because of the losses in the e-commerce, travel, hospitality, and lending sectors.
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Moreover, even after these statements by several companies, it cannot be inferred that the households are coming out of financial stress. Households are free from financial stress, which has now started to show up in the form of a change in preferred modes of payment. In the sixth edition of its report titled ‘Era of Rising Fintech’.
Many online business platforms have started with many offers and the best one is ‘buy now-pay later’, which allows people to buy according to their needs and pay later as there is no source of income for them at this point. Over a period of 30 days, digital payment transactions rebounded 23 per cent. Transactions are still not back to pre-COVID levels on Razorpay’s platforms as in the 101 days since March 24, they are still 12 per cent lower. Two of the segments which have seen a decline in transactions are peer-to-peer lending and utilities, which fell 41 per cent and 13 per cent respectively, as compared to the first phase of the lockdown.
At this very time, Utility bill payments continued to be a significant contributor to online merchant transactions and comprised 20 per cent of all such transactions. Financial service is the largest contributor accounted for 27 per cent.