PCM Vol.3 Issue 11
Emerging Markets have achieved a certain reputation in the payment industry. In this issue, we will explore the development of Emerging Markets and what's to come in terms of Payments & Financial Inclusion for the underserved
Emerging Markets have achieved a certain reputation in the payment industry. In this issue, we will explore the development of Emerging Markets and what's to come in terms of Payments & Financial Inclusion for the underserved
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Three ways financial services are providing<br />
new opportunities in India<br />
by Amrish Rau<br />
Hundreds of millions of households across the globe are<br />
without access to traditional banking services, stifling<br />
opportunity. In India alone, 250 million adults don’t have a<br />
bank account and the majority don’t have a credit rating.<br />
Consequently, it can be very difficult for these consumers<br />
to connect with businesses that require traditional<br />
payment verification models.<br />
While this paints a bleak picture, it’s one that is already<br />
starting to change thanks to the rise of innovative financial<br />
technology. Nowhere can this be felt more clearly than in<br />
India, where technology is being used to tackle crossborder<br />
payment, credit and remittance challenges head<br />
on. Here, progressive companies are shifting the way<br />
payment and financial services operate, opening up new<br />
opportunities for economic and social growth.<br />
Attempts to offer a seamless cross-border experience<br />
are further complicated in high growth markets where<br />
alternative payment methods – which refer to payments<br />
made using something other than a credit card like<br />
cash, coupons, bank transfers, prepaid cards etc. – still<br />
represent as many as two-thirds of all payments.<br />
India for example has a population size of over 1.3 billion<br />
but has just 24.5 million credit cards in circulation.<br />
In order to break down these market nuances, we are<br />
seeing established firms and fintech startups alike<br />
develop and implement innovative technology solutions to<br />
aid businesses that are trying to encourage cross-border<br />
trade and operate internationally.<br />
Cross-border payments<br />
Recent estimates have the cross-border market growing<br />
from $401 billion in 2016 to $994 billion in 2020, with<br />
nearly two-thirds of cross-border business expected to<br />
come from high growth markets such as Asia and Latin<br />
America.<br />
While the advent and uptake of eCommerce and<br />
mCommerce means cross-border now represents<br />
one of the biggest business opportunities available to<br />
merchants around the globe, many are being held back<br />
by cumbersome cross-border payment infrastructure and<br />
processes which are hindering their ability to meet and<br />
transact with potential consumers.<br />
At PayU we are doing our part to make cross-border trade<br />
easier for merchants and consumers alike. Earlier this<br />
year we launched our PayU Hub platform. PayU Hub aims<br />
solve many cross-border commerce challenges by using<br />
a single API integration to help merchants access to 2.3<br />
billion potential new customers in the major high growth<br />
markets across Asia, Central and Eastern Europe, Middle-<br />
East, India, Africa and Latin America.<br />
Rather than adopt a traditional cross-border model, using<br />
an international acquirer, PayU has redefined the way<br />
cross-border payments can be undertaken. PayU Hub’s<br />
hyper-local direct connections to local acquirers and direct<br />
connections to alternative payment methods set us apart.<br />
Thought Leaders Corner<br />
5
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