The Indian m-wallet market is expected to grow at a compounded annual growth rate (CAGR) of 141 percent to reach Rs 30,000 crore by the end of 2021-22, a study said. The growth, during 2015-16 to 2021-22, would be driven by growing usage of smartphones, robust mobile internet penetration, growth of e-commerce sector together with increasing disposable incomes, said the study by the Associated Chambers of Commerce and Industry of India and research firm RNCOS. Also Read - Ola to offer free oxygen concentrators to the needyAlso Read - Samsung Galaxy S20 FE Long-term Review
The Indian m-wallet market in 2015-16 was around Rs 154 crore. It is also anticipated that the market value of m-wallet transactions in India will grow at a CAGR of 154 percent during FY16 to FY22, and reach Rs 55 lakh crore from Rs 20,600 crore, the study titled ‘Indian m-wallet market: Forecast 2022’ said. M-wallet transaction is among the fastest growing paperless modes of payment or banking, and it is expected that the majority of transactions will go paperless in the next 10 years, it said.
M-wallet market is segmented into three broad services — money transfers from wallet to wallet, bank to wallet and vice versa which accounts for 38 percent share, followed by recharge and bill payments for mobile, DTH, landline, electricity and other such services (31 percent share). The remaining share of 31 percent is captured by online shopping, hotel/travel/movie ticket reservations, online food order, payment of insurance premium, recharging Metro rail card and others. ALSO READ: United payments system to make mobile wallets redundant: Report
While mobile wallet service contributed to 21 percent share in mobile payment volume transactions in FY16, its share is expected to increase to 79 percent by FY22, the study said. However, it said the Reserve Bank of India’s licensing regime is discouraging mobile wallet growth in the country.”The present system allows only e-transfer of money and approves semi-closed prepaid instrument issuance while it does not allow ‘cash out’ from the semi-closed wallet,” it said.
Besides, for all the entities (including banks, non-banking finance companies, telcos and others) to operate any kind of m-wallet, there are “copious strict” RBI policies which encumber the growth of m-wallet sector, it said. “The RBI should relax its current policies and allow cash withdrawals from the semi-closed wallets,” it suggested. ALSO READ: Mobile-wallet market in India to cross Rs 1,200 crore by 2019