Unlocking the top trends in retail payment systems

Sunil Param : Head of Content and Communications at Pine Labs

By Sunil Param | January 10, 2020

Sunil Param is the Head of Content and Communications at Pine Labs.

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Retail is the engine of growth for an aspirational and developing economy like ours that strives to hit the $5 trillion mark by 2024. India has become a global investment destination and the arrival of a retail behemoth like Walmart through the $16 billion acquisition of India's largest online retailer Flipkart and the opening up of e-commerce giant Amazon's largest campus in the world in Hyderabad are tell-tale signs of the potential of the India market for global retailers. Not to miss the huge opportunity that exists in revamping the in-store payment acceptance infrastructure for offline retailers in the country, primarily the nearly 12 million1 kirana stores that constitute a major chunk of the unorganized retail market in India.

India's retail industry already accounts for 10% of the country's GDP [Source: Invest India] and is poised for tremendous growth in the years to come. For this growth to happen, the overhaul of the retail payment infrastructure in India is the need of the hour.

Following are five top trends in retail payment systems to watch out for in 2020:

#1. Rise of the all-in-one POS platform

- India is witnessing the fastest growth (CAGR of 20.2%) in digital payments transaction value between 2019 and 2023, as revealed in a blog on the top factors driving the growth of digital payments in India.

The advent of new age POS machines has made life a lot easier for retail merchants to accept digital modes of payments at the point of sale. What's interesting to note here is that the retailers are looking to do more than just accept payments at the POS terminals. For instance, through the Pine Labs Plutus Smart POS machine, we are making it possible for merchants to calculate and compare different bank/brand EMI offers and offer them to their customers at the point of sale to drive sales.

#2. Gen Z to boost digital payment adoption

- How retail merchants effectively target the youngest shoppers of today i.e. Gen Zers will determine whether they will march on the road to profitability in 2020 or not. Tailoring a seamless tech-enabled in-store retail payment experience will help do just that. The shopping group of Gen Zers are extremely tech savvy audience and therefore making products affordable for them by offering no-cost EMIs from the POS machine itself will be a unique differentiator for retail merchants.

#3. Coming together of banks and fintech companies

- Be it the issue of NPAs or the rising expectations from today's customers, traditional banking has benefited from the evolution of fintech in India. The convergence of traditional banking with modern fintech companies will usher in a new era of growth and merchants in India will be one of the biggest beneficiaries of it. At Pine Labs, we have forged such strategic partnerships recently with India's leading private and public sector banks like SBI, Kotak Mahindra Bank, Federal Bank and Bank of Baroda to enable EMIs on debit cards.

#4. Quick access to working capital

- One of the biggest pain points of retailers is timely access to capital. Our thriving ecosystem of 150,000 merchant partners and counting has always benefitted from our innovative tech-driven solutions, like how we have helped merchants, large or small, to avail collateral-free business loans from within POS.

#5. Democratization of technology to spur innovation

- Earlier in 2019, the launch of our developer portal and the opening of the access to our proprietary APIs has been a gamechanger as far as innovative fintech solutions are concerned. We believe this is one trend that the industry must emulate and usher in the democratization of technology for developers worldwide to work using open APIs and build seamless payment solutions for the merchant community at large.

The focus area of fintech companies should now be on bringing the benefits of financial technology to the millions of small and medium scale retail merchants in India. Modern retail payment solutions have evolved thanks to the advancement in technology and one can expect these retail payment trends to play a key role in the future growth of the retail sector in India.

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