Telecom has a massive opportunity to accelerate digital payments and financial inclusion for the underserved communities across India.
By Shivnath Thukral
The mobile phone has emerged as a critical device that enables Indians to overcome geographical barriers, socio-economic status and to embrace new economic realities. Indians, across all demographics, have leapfrogged to the digital world by embracing mobile technologies, much more than others. The country is in the midst of one of the most dynamic social and economic transformations the world has ever seen, driven by the rapid adoption of digital technologies. The COVID-19 pandemic has accelerated the need to go digital.
Technology is playing a crucial role in scaling solutions and in just the past five years, more than 500 million people in India have gained access to the internet. While this is promising, it also highlights the wide scope of digital opportunities that remain untapped. According to the Telecom Ministry, the country saw its internet dependency increase by 13% during the lockdown. While this was well within the DoT capacity, the government and COAI, made significant efforts to ensure people remained connected at the critical time.
India is at an inflection point, and where we go from here is heavily dependent on internet accessibility. In this vast and diverse country, only an ecosystem consisting of powerful networks, along with affordability can transform the future of the nation. Today, helmed by Reliance Jio, India is home to the world’s second-largest internet user base, accounting for 12% of all users globally. With the help of affordable data prices, Reliance Jio helped spur the digital economy in India as it propelled internet usage in the country.
Looking at the future, WhatsApp’s collaboration with Jio has the potential to positively impact over 60-million micro, small and medium businesses and other small businesses that may currently be operating in the unorganized sector. Through this arrangement, we envision enabling people to browse the availability of shops, get answers from a business and ultimately purchase a product right within the chat with the business.
Small and Medium Businesses (SMBs) are the backbone of the Indian economy and are critical to the future of the country. Contributing to 6.11% of the manufacturing GDP, 24.63% of the GDP from service activities and 33.4% of India’s manufacturing output – SMBs are the second-largest employment generator in the country, providing jobs to close 120 million people.
Digital India has become the centerpiece of the government’s plans for the country and is slated to be a key driver of growth and digital inclusion. And as the country continues to transform into a digitally-empowered society, it is no surprise that business tendencies have evolved in that direction too. According to a survey by Nielsen, among people who message businesses, 63% say they have started messaging businesses more often over the past two years, and 67% plan to message businesses even more over the next two years.
Taking a page from Prime Minister Narendra Modi’s vision of an Aatmanirbhar Bharat, access to the right digital tools can help lay the groundwork for businesses to be self-reliant and flourish in India. By providing access to a reliable platform, WhatsApp is playing an instrumental role in helping small businesses interact with their customers and optimize sales especially now when digital tools can serve as a lifeline for businesses and customers to stay connected. For example, Books by Kilo (an online portal that sells books by weight) has seen a 50% increase in customer interactions since using the WhatsApp Business app during the lockdown. Similarly, Kriger Campus’, an education network and marketplace, business interactions on WhatsApp have increased by 55% since the lockdown. With 15 million monthly users of the business app in India, businesses are finding tremendous value in the very nature of WhatsApp.
In this vast and diverse country, only an ecosystem consisting of powerful networks, along with affordability can transform the future of the nation.
In addition to having access to digital tools, we need to make available, efficient, and scalable financial services for people in the unorganized sector and rural India. Despite India’s boosting economic growth rates higher than most developed countries in recent years, a majority of the country’s population still remains unbanked. In order to achieve inclusive development and growth, the expansion of financial services to all sections of society is critical.
Across sectors, WhatsApp is a platform that enables an ecosystem to start scaling and we truly feel that it can play a key role in driving digital and financial inclusion in the country and connecting the unconnected. If we come up with a technology to solve such issues in India, there is no better platform than WhatsApp to enable this.
We can now take the lead to “engineer in India” and then make it global. Our goal is to create the template for digital public infrastructure, which will further help in solving problems in areas of poverty, digital learning, and economical problems. Over the next two years, we hope to open up in entrepreneurial ways we haven’t before. With the help of our partners, we will launch many experiments – scaling digital banking, increasing access to basic financial service for every Indian, helping digitize the MSME operations to enable lending – and these are just starting points that are in motion.
Payments on WhatsApp is a massive opportunity for us to accelerate digital payments and financial inclusion for people across the country. We are optimistic that with the power of a mobile phone coupled with WhatsApp, people in underserved communities will be able to stay connected, recover in the post-COVID world, and prosper.
The author Shivnath Thukral is Public Policy Director with WhatsApp India