Anushruti Singh
India has made significant strides in expanding the global network for UPI, along with taking measures to enable seamless cross-border transactions. This reduces the cost of fund transfers and remittances. It also implies that doing business overseas for MSMEs will become easier than ever.
UPI going international will bring in huge potential and growth for India in the business-to-business segment, feels Sheik Mohideen, Senior Vice President, SMB and Partnership, Worldline India. In a discussion with SME Futures, he talks about why digitisation is a superpower for Indian MSMEs and how the acceptance of UPI payments in foreign lands is going to benefit them
Edited excerpts:
India’s UPI has entered a number of overseas markets. How do you see this strategic move for India? Your personal thoughts.
India’s stack is a phenomenal success and is in the right direction for the next level of growth in the international markets. We are easily 5 to 6 years ahead of other countries when it comes to digital payments.
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We are making significant strides in expanding the network of our digital payment systems like UPI (Unified Payments Interface), RuPay, etc. globally. The countries that have embraced different forms of Indian payment systems include France, UAE, Saudi Arabia, Bahrain, Singapore, Maldives, Bhutan, and Oman. This implies that Indians will now be able to make payments through UPI, RuPay etc. in these countries.
One of the most important success parameters for UPI in India was the scale that we were able to achieve within a short span of time, hence speed is the new essence of business. UPI will become a huge success in the international markets if we can replicate that speed to achieve the same scale globally.
How will this development benefit India Inc, particularly the MSMEs? Could you please explain how it is going to affect EXIM?
Taking UPI to the international markets and building a truly interoperable global payments system with other participating nations will be a game-changer. It will make cross-border payments immediate, cost-effective, accessible to everyone especially the MSMEs, and settled in a secure medium, thus adding value to the global payment ecosystem.
Currently, there is huge potential and growth that India is witnessing in the business-to-business segment. The MSME’s in this segment will not only require a full stack payment partner but will also need a seamless solution for the acceptance of international payments like Worldline. Whether it is business-to-business or business-to-customer, payments will play a crucial role in increasing revenue. UPI’s launch in overseas markets could be the solution and this will definitely have a positive impact on the economy through EXIM.
How is Worldline involved in this development? What will be your function here?
Worldline has joined forces with NPCI International Payments Ltd (NIPL) in a move to expand the acceptance of Indian payment systems across Europe recently.
As part of the partnership, Worldline will bring more convenience for Indian customers in the European markets by allowing merchants’ point-of-sale (POS) systems to accept payments from UPI, an instant real-time payment system, as well as RuPay, NPCI’s proprietary card payment network solution. This will result in a multitude of customer-related merchant benefits due to an increase in the footfall and spending from Indian tourists.
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Currently, customers from India pay through international card networks. However, the hugely popular UPI allows multiple bank accounts to be accessed through one single mobile application. This, in turn, will enhance customer experience whilst opening up new business prospects for merchants.
It will be facilitated via Worldline QR, our universal product for the acceptance of all QR-based payments. The first target markets for NIPL are set to include BENELUX and Switzerland with further plans for expansion, as Worldline QR is rolled out in more European countries.
India is one of the most important tourist markets for Europe with an estimated 10 million Indians travelling to the region each year prior to the pandemic, according to Schengen Visa. Now, as the impacts of COVID-19 are beginning to subside, that number is expected to increase significantly.
Also, for any payment platform to grow and reach scale, it needs the entire payment ecosystem to innovate around the platform. Worldline being an agile paytech player and 4th largest in the world, our scale and reach give us the power to innovate and enable new payment methods along with the other players in the ecosystem to provide a seamless payment experience to the MSME’s and to their end customers.
Is modernising the MSME’s and the government collection department still a stretched out and slow endeavour? What are the challenges that need to be dealt with to fast track this process?
Digitisation is like a superpower that can transform MSMEs into unstoppable forces in the Indian economy, as they contribute almost 33 per cent of the country’s Gross Domestic Product (GDP).
The MSME sector has indeed seen a boom in the adoption of digital platforms and payments post-pandemic with 72 per cent of MSME payments now being made online (through cards, UPI, net banking, etc.) Despite this, the MSME sector still lacks concrete digitised solutions. There is still scope for improvement.
The government and the regulators are taking all the right and timely measures to drive modernisation and digitisation in this sector. Two schemes that will empower MSME growth in India in the coming years are the Emergency Credit Line Guarantee Scheme (ECLGS) and the Open Network for Digital Commerce (ONDC).
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If you look at the largest tax collecting platform in the country, the GST, more than 90 per cent of MSME’s are paying their taxes online. Other government departments like the NTRP and customs are only digital platforms through banks.
At Worldline, we have more than 100 government departments across the country using our payment solution either directly or through our banking partners. Recently, we partnered with the Bank of India (BOI) to deploy our Android POS machines to digitise several kinds of citizen-centric services, fines and tax collection services for the Panvel City Municipal Corporation (PMC), the Madhya Pradesh Police and the J&K Police to name a few.
In general, for us to fast track the ecosystem, there should be a concentrated focus on persuading government departments to adopt this change, on educating the consumers and on creating more awareness in the tier 2 to tier 6 cities.
When do u think India will become completely digitalised and what will be the overall impact of that on the Indian economy?
This is a journey and instead of focussing on 100 per cent digitisation, we should focus on yearly growth in terms of its adoption in the country. The scale and growth that we are seeing right now is still mainly in the metros and the tier 1 cities.
The tier 2 and below cities are still under served and have a lot of catching up to do in terms of digital adoption. The right metric for us to focus on is the growth and adoption happening in the Bharat segment and for any business to excel in India they should find out a product and service that can be used by the consumers from Bharat.
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There will be a positive impact on the Indian economy only when we see digital transformation in Bharat. This transformation will be a crucial factor in our endeavour to become a $5 trillion economy, to achieve the ambitious target of 25 per cent manufacturing growth and to meet the job creation demand of an ever-growing workforce.
What is the roadmap for Worldline for 2023?
In 2022, Worldline generated a revenue of approximately 4.4 billion euros, and it showcases our potential as a major global paytech player. In India, we are not only growing but we are also growing profitably and are committed to India for the long term. Our ability to invest and offer new solutions comes from the fact that we are profitable, and we are able to reinvest it back in the business and that is something that we will continue to do.
We have been here for more than 20 years, and we are a serious and systemic player in India in the payment space with over 1.5 million merchant touchpoints. We will continue to stay and grow and keep introducing innovative technologies to provide a stable, secure and seamless payment solution to our partners and merchants, especially the MSMEs.
