From average 5 lakh to 1.2 million per day, digital transactions have gone up by 25%, thanks to demonetisation

Prime Minister Narendra Modi’s aggressive push for cashless society is showing some results post demonetisation as digital transactions have gone up by 25% since demonetisation announcement.

Not only in organised retail, digital payments saw an increase from roadside merchants as well, who are shifting to digital payments.

"From month on month, now we are checking weekly growth data which is showing a jump of around 5 per cent per week, which is a very healthy number. The average value of each transaction which had slipped to Rs 2,000 from Rs 2,700 before November 8 has now stabilised at that level," Lokvir Kapoor, chief executive officer at Pine Labs, which facilitates installation of point of sale (PoS) terminals at merchant outlets, told ET.

Since note ban, Pine Labs has been processing around 1.1-1.2 million transactions on an average per day. Before demonetisation, the figure was nearly 5 lakh on an average weekday.

"We did 2 million transactions last Sunday; this Sunday being Christmas, we saw 2.2 million transactions on our network which is a healthy 10 per cent jump," Kapoor told ET.

"We are mostly prevalent in smaller cities like Jaipur and Chandigarh and are operating 10,500 PoS terminals presently. Now, our call centre is flooded with queries from merchants who wish to accept digital payments; we received an order of 3,000 terminals over the past one month," Jitendra Gupta, managing director, PayU India, told ET.

India has around 15 lakh PoS terminals, almost 74 crore (740 million) debit cards and 2.7 crore (27 million) credit cards. This data does not refer to wallets which are a parallel network.

These mobile wallets too have started reaping the benefits of demonetisation.

Card processing companies and banks have upgraded their bandwidth to process the rising number of payments.

"I believe it will take around 18-24 months of consistent push from the authorities in order to bring about a behavioural shift in Indians. The habit of making payments through cash has to change so that people even make card transactions for small purchases," Manish Patel, founder of mSwipe, which also works with roadside stalls, told ET.