Unfiltered

MARCH 19, 2019

Having emerged as one of the top three payment applications on UPI thanks to P2P and bill payments, Google’s offline strategy is designed to create an ecosystem of payment solutions for Indian consumers.

After peer-to-peer (P2P) and bill payments, Google Pay is looking to win over customers of smaller offline retailers or kirana stores. While Google had announced plans to partner with point-of-sale providers to onboard retail merchants, it is now piloting transactions based on the Unified Payments Interface (UPI) to be made by consumers while making offline purchases, according to two people aware of the matter.

“It will bring the convenience of card payments onto the smart phone–the only thing required here will be, instead of the card swipe, customers will have to share the mobilenumber at the billing counter,” said a top payment executive aware of the matter. Consumers will get a ‘collect’ request on their Google Pay application and make the payment by inserting the UPI PIN.

Having emerged as one of the top three payment applications on UPI thanks to P2P and bill payments, Google’s offline strategy is designed to create an ecosystem of payment solutions for Indian consumers. For the technology giant, which is aiming to connect the Next Billion Users to the internet, India is a key market. By leveraging payments, the company is targeting a big chunk of the consumer-retail interface.

“There are small-scale pilots that are being run across retail stores in the country. As of now there are no banner advertisements that are being done, only early adopters can test the product,” said one of the persons cited above. “The rollout will happen over the next few months.”

Google has much of the backend in place for such an exercise.

“The plan is to also run localised promotional campaigns for consumers in that area,” said one of the persons. “They have geo-tagged shops and can easily identify consumers in the surrounding area as well thereby offering targeted marketing campaigns.”

Google’s plans are similar to the offline strategy of PhonePe, which is using MapMyIndia to target offline stores and promote UPI payments.

“Our vision is to enable fast, seamless, and secure payments for our users anywhere, at any time, whether they are paying other users, buying products or services online, recharging mobile balance, paying for utilities or shopping at a retail outlet,” said Ambarish Kenghe, director, product management, Google Pay. “The offline ecosystem forms an important part of our objective to provide a seamless experience to users transacting with Google Pay.”

After ecommerce payments, the next battle is widely expected to be fought on the offline payments front. Paytm, with its expansive network of merchants using Paytm QR, is expected to be challenged by Google Pay, Reliance Jio and PhonePe.

“All eyes are on Reliance Jio, especially after what happened in telecom. What Jio wants to do in digital payments is being keenly observed by others,” said a payments industry expert. “Offline is the next big thing which will create the ultimate winner in the Indian payments ecosystem.”

With its own integrated billing and payments offering for small merchants, Jio could disrupt offline payments.

PhonePe chief executive officer Sameer Nigam has told ET that the company has partnered with MapMyIndia to track retail merchants in the country and create an engagement platform for users with local kirana stores. Similar to Google Pay, PhonePe is also listing local merchants on its application.

“The best part is for Google is that the India fintech strategy is not defined by revenues. It is more about creating that experience for the consumers and enhance stickiness,” said the expert.

FEBRUARY 4, 2019

Delay in releasing key employment data has undermined the credibility of data officialdom

The resignations of the National Statistical Commission’s acting Chairperson P.C. Mohanan and member J.V. Meenakshi appear linked to the Centre’s refusal to release new data on employment that were due to be made public in December 2018. They could also be related to unease about the recently unveiled back-series data on the economy, which recorded slower growth during the UPA-led government’s rule, and were released by the NITI Aayog bypassing convention and the commission’s views. Reports suggest that the findings of the new Periodic Labour Force Survey, for July 2017-December 2018, are not too flattering, with unemployment registering a five-decade high. The government has said no such reservations were expressed by Mr. Mohanan or Dr. Meenakshi during NSC meetings and that the report will be released after ‘quarterly’ data for the survey period is processed. A key role of the NSC, set up in 2006, is to verify whether data being put in the public domain are reliable and adequate. Information has been collected and disseminated by successive governments under laid-down schedules, earning Indian data greater global trust than most other emerging market peers, especially China.

On the question of job-creation for the youth, the Prime Minister and his Cabinet have been building an argument that jobs abound, but credible data are missing. The National Sample Survey Organisation’s quinquennial employment surveys were to be conducted in 2016-17. The year was switched to 2017-18 as the new Labour Force Survey was being prepared to replace it. Separately, a quarterly survey of select employment-intensive sectors initiated by the Labour Bureau after the 2008 global financial crisis, that provided some clarity on ground realities, was inexplicably junked. Instead, proxy data from enrolments into social security schemes for formal sector employees are being touted as a sign of job-creation: economists have rightly called them out as inaccurate. Even then, Arun Jaitley, in his last year’s Budget speech, cited ‘an independent study’ to claim seven million formal jobs will be created in 2018-19. The Centre for Monitoring Indian Economy has pegged job losses in 2018 at 11 million based on its regular employment surveys. The government’s coy approach to jobs-related data may be due to its disastrous demonetisation gambit which hurt supply chains and informal jobs in the economy and whose effects have lingered. Contrast this with the NSSO surveys of 2009-10 that revealed little good news on household incomes and job-creation, thanks to after-effects of the global financial crisis. The UPA didn’t dither from releasing the data, took criticism on its chin, explained it was an exceptional situation and commissioned another set of surveys in 2011-12 to correct for the timing. The Modi government should have treaded the same path without upending India’s statistical integrity.