The group president for Visa, one of the world's largest payment companies, has said that governments can curb black money by partnering commercial institutions to promoter electronic payments. Electronic payments includes the gamut of channels through the banking channels which includes, credit cards, internet and mobile payments.
In an interview with TOI, Elizabeth Buse, group president, Visa, responsible for Asia Pacific, Central Europe, Middle East and Africa said that bringing transactions out of cash into electronic forms will allow governments to have better tax compliance and greater monitoring of fraudulent transaction and money laundering.
"In markets like Mexico we have seen government subsidize terminalization to bring more transactions out of the black economy. Without government participation it is challenging for commercial enterprises to come and promote electronic payments. The government has to be a partner," she said. Besides reducing black money, electronic payments also promote growth, Buse said. She pointed to a Moody's finding that between 2004 and 2009 electronic payments have added 50 basis points to global GDP, adding $1.1 trillion to global wealth.
According to Buse, there are a number of impediments for electronic transactions, but top of the list is acceptance. "In India only 3% of consumer spending transactions are through electronic payments. So you have 97% of this big fast growing economy as an opportunity," she said. Buse, who is considered as one of the 25 most powerful women in finance by US Banker, is in the process of tying up with State Bank of India to install credit card swipe machines in at least five lakh merchant establishments - a target set by SBI.
"To solve the merchant acceptance problem we knew that it will require a different structure than what we have today. We really wanted to increase the rate and breadth of consumer acceptance because 80% of the consumers do not live in the big cities where you have the POS terminals."
Buse said the new acceptance machines will be different kind of terminal which would perhaps use mobile network. "You may think of a hotel as a traditional form of merchant establishment that accepts cards but we have to reach small merchants in small towns and that will require different services and a different economic model."
She feels that debit cards will drive payments in India. India has 22.8 crore debit cards, and debit card transactions grew 39% last year. "We see much of the cash transaction going to debit and SBI has the largest debit card portfolio. So we are partnering SBI on the customer side as well as the merchant side."
The other big bet is on mobile payments. According to Buse, in mobile payments where standards are still evolving, the most prevalent model will be one open to maximum number of participants and which runs on most of the mobile handsets.
On Thursday, Visa announced that it is acquiring South Africa based Fundamo, a leading platform provider of mobile financial services for mobile network operators and financial institutions in developing economies. It also announced a new, long-term commercial agreement with Monitise PLC, a leading provider of mobile money solutions for financial institutions in more developed geographies.
[Source]
In an interview with TOI, Elizabeth Buse, group president, Visa, responsible for Asia Pacific, Central Europe, Middle East and Africa said that bringing transactions out of cash into electronic forms will allow governments to have better tax compliance and greater monitoring of fraudulent transaction and money laundering.
"In markets like Mexico we have seen government subsidize terminalization to bring more transactions out of the black economy. Without government participation it is challenging for commercial enterprises to come and promote electronic payments. The government has to be a partner," she said. Besides reducing black money, electronic payments also promote growth, Buse said. She pointed to a Moody's finding that between 2004 and 2009 electronic payments have added 50 basis points to global GDP, adding $1.1 trillion to global wealth.
According to Buse, there are a number of impediments for electronic transactions, but top of the list is acceptance. "In India only 3% of consumer spending transactions are through electronic payments. So you have 97% of this big fast growing economy as an opportunity," she said. Buse, who is considered as one of the 25 most powerful women in finance by US Banker, is in the process of tying up with State Bank of India to install credit card swipe machines in at least five lakh merchant establishments - a target set by SBI.
"To solve the merchant acceptance problem we knew that it will require a different structure than what we have today. We really wanted to increase the rate and breadth of consumer acceptance because 80% of the consumers do not live in the big cities where you have the POS terminals."
Buse said the new acceptance machines will be different kind of terminal which would perhaps use mobile network. "You may think of a hotel as a traditional form of merchant establishment that accepts cards but we have to reach small merchants in small towns and that will require different services and a different economic model."
She feels that debit cards will drive payments in India. India has 22.8 crore debit cards, and debit card transactions grew 39% last year. "We see much of the cash transaction going to debit and SBI has the largest debit card portfolio. So we are partnering SBI on the customer side as well as the merchant side."
The other big bet is on mobile payments. According to Buse, in mobile payments where standards are still evolving, the most prevalent model will be one open to maximum number of participants and which runs on most of the mobile handsets.
On Thursday, Visa announced that it is acquiring South Africa based Fundamo, a leading platform provider of mobile financial services for mobile network operators and financial institutions in developing economies. It also announced a new, long-term commercial agreement with Monitise PLC, a leading provider of mobile money solutions for financial institutions in more developed geographies.
[Source]
0 comments:
Post a Comment