Let us try and predict what the retail space will look like in 6 months’ time.
COD (Cash On Delivery) occupies 80% of total sales for retail giants like Flipkart. This move will mean an extreme low, sales wise. It would force retail companies to innovate. Digital payment solutions will see an extreme spike in their user base, the number and the size of transactions as consumers rush to find a safe non-cash payment option. This puts digital payment companies in a unique and profitable position of pushing specific brands and products.
Smaller players who deal mostly in cash will be affected the most. Small town and rural retailers might be stretched to their capacity of providing goods on credit. However, the unorganized retail sector is also the most resilient and widespread. By the time things go back to normal a substantial portion of the consumer base will have moved on, at least partially to digital payment modes. To counter this, small retailers must also familiarize themselves with the shifting landscape. However, there are few entities working to provide timely information, insights and resources to help retailers evolve with the times.
One lesson that clearly makes itself felt is the need to integrate micro-entrepreneurship with technology. Cash economy is here to stay but a large chunk of payments is going digital. It would have happened anyway but demonetization has accelerated the process. Pay1 is here to handhold our retailers in every city, town and village through the transformation by giving them exactly what they need – a seamless interaction between cash and digital modes of payment.