Indian shopkeepers resistant to taking up cashless payments
Indian shopkeepers are refraining from accepting cashless payments from mobile wallets, despite the government promoting their use. Retailers are put off by the INR50,0000 per month fee for transferring money from mobile wallets to bank accounts and the fact that distributors insist on cash payments, which are difficult to withdraw from banks. Transfer limits from wallet to bank are also a hindrance. Financial institutions have said that an update to e-KYC details will allow vendors and merchants to transfer up to INR100,000 to their account.
VISAKHAPATNAM: Even as the state government is focussing on promoting cashless transactions, several shopkeepers who had resorted to the use of mobile wallets soon after the demonetisation drive was launched are now refraining from accepting payments in the cashless mode.Shopkeepers complain that the limit of Rs 50,000 per month for transferring funds from mobile wallet to bank accounts is a hindrance to business. At the same time, withdrawal limits at banks are also taking a toll on rotation of currency for the shopkeepers.Elaborating on the problem, Bucchi Ramana, who runs a kirana shop near Pedawaltair, said, “Initially due to the cash crunch , we started accepting payments through mobile wallet. The number of people paying through mobile wallet instead of cash also steadily increased. But, the problem is that none of the distributors are accepting payment through mobile wallets . They are insisting on cash, so we have to go to the bank and withdraw the money. Even though we are willing to do that, the banks are not having sufficient cash and we have to stand in long queues to get amounts less than Rs 24,000 per week. This is affecting business and hence, I have stopped accepting payment through mobile wallets.”Similarly, Gangadhar A of Siripuram complained that the transfer limit on mobile wallet is a hindrance for business. “If we can transfer the entire amount to the bank, then it won’t be a problem for us. But here, the money is getting locked up in the mobile wallet and we are not able to spend it on the goods that we purchase for our shop.” With an average business of around Rs 10,000-12,000 per day, he said it had become difficult to pay distributors for the goods through the mobile wallet.However, bank officials said by updating e-KYC details, merchants and vendors can transfer up to Rs 1 lakh to their bank account. “Vendors using mobile wallets can apply online and provide their KYC details to the mobile wallet following which their transfer amount will be enhanced to Rs 1 lakh. The vendors can use this facility to increase the amount of transfer from mobile wallet to bank account,” a bank official said.