Mobile financial services increasing in India

NEW DELHI, INDIA: Indian consumers are comfortable using mobile applications for managing their finances or availing mobile financial services (MFS) to pay for utilities bills and household groceries.

A new Amdocs-Ovum indicates rise in social commerce, and says that consumers are using digital channels such as mobile app, online, and social networking for mobile financial transactions.

The survey also found that Indian consumers are increasingly using social networking channels to buy products and services advertised on social networks and transfer money to friends and family.

Key findings include:
•    34 percent respondents are very comfortable using mobile apps to manage their finances, 27 percent are somewhat comfortable.
•    27 percent unbanked customers are very comfortable with mobile financial services, and 19 percent are somewhat comfortable.
•    33 percent used MFS to buy products/services advertised on social networks.
•    30 percent used MFS to pay bills via social media and
•    17 percent to transfer money to friends and family.

In terms of future adoption of social commerce in the next 12 months, 18 percent respondents said they are likely to buy products and services on social networks and transfer money, while 17 percent would use these channels to pay bills.

While the survey observed an encouraging trend for digital payment for utilities and household groceries, it also found that in-person payments still dominate shopping in India and cash is by far the preferred payment instrument.

However, the use of digital and mobile channel for utilities bill payments and buying household groceries is growing. Twenty seven percent respondents pay their utilities bills online by using their laptop or desktop, while 19 percent use mobile banking. Twenty one percent respondents say that they buy household groceries online and 17 percent use a mobile app.

“Although active MFS usage remains modest in India, what stands out from the survey is that the majority of the active base  have already embraced more advanced mobile financial services and associated m-commerce applications, including social commerce,” said Eden Zoller, Principal Analyst, Ovum. “Service providers must ensure they have a well-drawn out product road map to carry users along the MFS adoption curve, from simple to more advance applications.”

“A sizable population in India is gradually moving towards the cashless economy, even though financial inclusion still remains a challenge for majority of the people,” said Sharath Dorbala, Head, Sales, Marketing and Products, MFS, Amdocs.

“The market trends indicate that a mobile financial services solution that can integrate well with social network platforms can be a boon for Indian mobile financial services providers, as most of the online transactions will happen on mobile devices in the future,” he said.