Home >Money >Personal Finance >'Digital payments saw monumental revolution in the wake of covid-19'
Porush Singh, divisional president, South Asia, Mastercard
Porush Singh, divisional president, South Asia, Mastercard

'Digital payments saw monumental revolution in the wake of covid-19'

Porush Singh of Mastercard, talks about what this means for the digital payments industry and how new-age technologies such as AI and machine learning can revolutionize the way security and accessibility are managed

The pandemic is changing the way people live, work and transact. Porush Singh, divisional president, South Asia, Mastercard, talks about what this means for the digital payments industry and how new-age technologies such as artificial intelligence (AI) and machine learning can revolutionize the way security and accessibility are managed.

How much of a change do you think covid-19 has brought about in how people transact?

There’s no denying that covid-19 has changed the way we work, shop and communicate. Notions of speed, convenience and safety are being re-examined and redefined. Finding the balance between the need to protect ourselves and the need to interact to maintain our daily lives is a challenge faced by everyone.

Achieving this balance means raising awareness about the choices we have. This includes how we choose to pay—by using cash, touching a PoS (point of sale) machine when using a card, or going contactless with a card or mobile device. As many countries imposed lockdowns, the majority of consumers turned to digital payments for necessary purchases. This crisis has changed the payments landscape and the industry has a critical role to play in the covid-19 containment efforts. According to a recent consumer survey, the usage of digital payments among Indian consumers in the current scenario was the highest around the globe, at 75%. Further, around 78% Indians said that they will adopt digital payments more actively over the next six to nine months.

It is evident that the adoption of digital and contactless payments will grow, going forward. It is imperative that industries and governments work together to maximize the adoption of digital commerce.

How does Mastercard plan to ensure business continuity post-covid?

Our operations have continued without disruption as we swiftly shifted to flexible work arrangements across our offices globally. We have ensured that all our staff is safe and well equipped to work remotely.

We are maintaining the electronic payments ecosystem that provides critical infrastructure, security, products and services to help businesses and consumers manage through the pandemic. Our network allows consumers access necessities from the comfort and safety of their homes or with minimal physical contact via contactless payments. As a result, merchants have continued to operate. Now, more than ever, small merchants, MSMEs, and farmers cannot be overlooked.

Cash is still king for many Indians. Do you think the uncertainty will make people regress into hoarding and using cash more?

Although cash is deeply embedded in the Indian payment system, the perception of cash as a vehicle for covid-19 has led to a marked shift from cash to digital payments. Various reports suggest that people are adopting digital modes of payment to avoid potential contamination issues around handling currency notes.

However, to further strengthen the acceptance of digital payments, it is important to increase merchant involvement and make the process of transaction easier and more secure. We have been working with the industry and the Reserve Bank of India (RBI) to increase the limit for contactless “tap and PIN" transactions, which has been revised to over 2,000.

Will covid-19 give a push to digital payments like demonetization did?

We have already adopted digital payments at a massive rate. The government, regulators, banks and service providers encouraged consumers to adopt digital payments to contain the spread of covid-19. What we are now seeing are signs of further growth and acceptance of digital payments among a large population in India. While demonetization pushed India’s need to move to digital, covid-19 will expedite the transition into a less-cash economy in the long term.

As digital becomes the new normal, facilitators of digital platforms—providers and retailers—will need to work together and invest in infrastructure to support the digital drive. Strengthening core infrastructure by investing in modern payment platforms and cloud-based infrastructure to increase resilience, security, scalability and market agility is imperative.

There are already a number of fintechs servicing the digital payments space. How does Mastercard plan to navigate this market?

We have always partnered with fintechs to further digital commerce and bring innovative solutions to the market.

Last year, our global leadership announced promising investment plans for India. We are investing in providing people new ways to pay. We brought Mastercard Labs to India in 2017, which identifies and experiments with future technologies in key areas, including digital payments, data solutions, financial inclusion, alternative payments, and safety and security. The lab also supports our flagship Start Path programme that works with startups and supports them in developing solutions. Through this, we have supported and grown technology startups like Tonetag, Zeta and Fluid AI.

We are working towards bringing cutting-edge technologies facilitating AI to assess behaviour patterns and avert online frauds. With an aim to reduce response time and contain threats, we are leveraging AI and machine learning-enabled systems that can easily predict any irregularities in the payment process and take swift preventive measures at the right time.

Do you anticipate any major shifts or innovations emerging out of the present situation?

In the wake of covid-19, the digital payments industry has witnessed a monumental revolution. Consumers are increasingly adopting and trusting the technologies available to them.

Technological advancement in digital security will also play a vital role in driving digital and contactless payment acceptance across India. While new-age technologies such as blockchain, big data, and AI will be shaping the future of digital payments, it would be equally critical for the industry to collaborate and offer solutions that are aligned to the customers’ needs.

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