How often have you come across people who’re not smartphone-savvy or can’t read or write — say elderly people, your household help, or your local sabziwala, for that matter — whom you’ve urged to download a mobile wallet like Paytm, Freecharge, or Mobikwik and they’ve flatly refused because they find the registration process, the UX (user interface), and the transaction process cumbersome and confusing? Chances are often.
While the government and mobile wallet companies have been pushing the cause of a digital, cashless, India, the fact of the matter is that digital payments solutions like mobile wallets need to evolve in a different direction to appeal to the ‘aam aadmi’ (or ‘aurat’) in India — they need to be simple in their usage and UX. Until mobile wallet companies figure this one out, they’re likely to see transactions, which decreased 13% to 269 Mn in March because of the RBI making KYC mandatory for all users, only dip further.
The good news is that someone has realised this problem and is trying to address it. “I have seen my mother and many uneducated people struggle to pay their basic bills. I was looking for a tech solution which would enable everyone to understand and access digital payments. This is when I realised that photo-based transactions is the next step in digital payments,” says Sreekanth Eragadindla, the 24-year-old founder of Bengaluru-based fintech startup OmegaOn.
OmegaOn, founded in 2016, has come up with PhotoClickPay, a payment product that simplifies mobile wallet transactions by keeping the UX simple and using photographs to help drive navigate on its app. The idea is that even if a person can’t read and write properly or isn’t comfortable using app interfaces, he/she would be able to recognise the picture of a bulb for electricity, a Vodafone or Airtel icon for mobile bill payment, or a house for rent etc, and be able to navigate and use the app to carry out transactions.
This is how it works: Once you download the app from Playstore — it’s just 6.5MB and downloads in a jiffy — and open it, it takes you to a Sign In/Sign Up screen where you have to enter your mobile number. The app then authenticates the user and urges you to create a 4-digit pin (a security feature). You will then land on a screen with a very simple UX with minimal text and photos to help guide you through the features.
There is GoPay through which you can ‘Add Money’, ‘Send Money’, or ‘Request Money’ marked by photos of a wallet and the ‘₹’ symbol. GoBillPay uses images such as your mobile service provider’s icon, a DTH symbol, a datacard, a bulb for electricity, a cylinder for gas, a landline telephone, a house for rent, and even icons for insurance, broadband and water. There is also GoServices, which has photos of a bus, an aeroplane, and a hotel for respective bookings. Money can be added like any other ewallet via debit or credit card.
PhotoClickPay leverages artificial intelligence (AI) and unique IDs like Aadhar and mobile number to predict customer payments and future needs. With ease of use and a simple UX being its USP, OmegaOn aims to tap a market that is currently driven towards only cashbacks and other offers on mobile wallets and wants to make people realise the ease of paying bills through its app.
The startup has more than 50 paying guests or hostel payments. Over 15 colleges use PhotoClickPay as a mode of payment
As of now, the total users of the product is about 45,000 (the app is still in beta version) The startup has been able to facilitate monthly payments volume of over INR 2 Cr.
In about three months, OmegaOn plans to launch a new innovation in vendor payments. The vending payment tool is powered by IoT and Near Field Communication and enables users to pay via OmegaOn’s App and have vending machines dispense cold drinks, tea, snacks, biscuits etc.
The Eureka Moment
From idea to startup is usually a long, experimental journey, and OmegaOn has had its share of experiments. Sreekanth says when he started working on PhotoClickPay, he thought everyone could see and understand colours, so he built a platform where users would have to tap on orange to pay electricity bills and green to pay DTH bills. “But, I soon realised this wouldn’t work as payments are not limited to bills. In fact, bill payments are hardly 10% of the monthly expenses of an average household. So, I figured we’d have to make something even simpler,” he says.
But the quest to make things simpler was not at all that simple. They next built the bills payment option in the form of photos or images, but this led to another problem. “The user needed to add bills to photos for the first time, but our end user wasn’t comfortable with that… he needed an interface of photos so that when he tapped on it, the bill got paid. So, we built a patent-pending technology called PhotoClickPay,” says Sreekanth.
OmegaOn did its homework before developing the new technology. “We know that people accept cash, cheque, cards, etc as modes of payment. We also know that people accept QR scanning and typing as a mode of payment. We spoke with more than 1,000 people over six months to understand whether they felt photos would be a more comfortable mode of payment or not,” Sreekanth says. And the answer, he says, was a resounding yes.
OmegaOn has tied up with Mahanagar Gas, Vodafone, Airtel, etc. to enable its users to pay these bills online. OmegaOn is also working closely with the Andhra Pradesh government to simplify payment methods.
With Paytm, Mobikwik etc, What’s the Need For OmegaOn?
Sreekanth says that despite leading mobile wallets such as Paytm, Mobikwik, PhonePe, Tez, Whatsapp, and Freecharge operating successfully in the market for a few years now, only 13% smartphone users carry out digital transactions. He says the reason for this is that people who are uneducated or not tech savvy find it difficult and cumbersome to register, type in bill details, enter authentication details, etc.
He’s thinking in the right direction, considering India is home to a staggering 287 Mn illiterate adults or 37% of the world’s total uneducated population, according to a report by UNESCO. Besides, 70% of India being rural with little or no access to electricity, data services etc.
Sreekanth says, “We envisioned a technology which would automatically bring all your bills in the form of photos and the platform should be personalised so that consumers can get pictorial help for their payments.”
He remembers one of their turning points when OmegaOn launched a test version of the app in a village and 300 uneducated people paid basic bills simultaneously. “That was a dream come true. These people would never have made those payments through a mobile wallet if they were required to type in the bill or card details,” shares Sreekanth.
Cash — Mobile Wallets’ Biggest Competitor
No matter how big the potential market, it’s never easy for a startup to make its presence felt, especially in a market saturated with competitors. OmegaOn’s biggest challenge, says Sreekanth, has been taking on deep-pocketed fintech companies that lure people with cashbacks and other offers, which startups like his can’t afford.
He adds that PhonePe is one the true competitor for anyone looking to make a mark in the B2C payments. “But we admire them for being so fast in implementing things and, to be honest, we need this kind of competition to help the industry grow,” says Sreekanth.
Also, while working with SMEs (as OmegaOn is), merchants are resistant to accepting digital payments as they’re scared there might be a tedious process involved and that they may have to pay huge taxes.
But more than any other competition, mobile wallet companies are trying to figure out ways to ward off their biggest competitor — cash. “The truth is that cash is the biggest competition for everyone in the digital payments game.” India’s cash-to-GDP ratio is around 12%, among the highest in the world.
The demonetisation, after which the Income Tax department warned individuals against cash transactions of beyond INR 2 Lakh, certainly went a long way in boosting the chances of digital payment companies. Besides, government schemes like the Unified Payments Interface (UPI) are also encouraging users to go online.
The Future Of Digital Payments Startups
With fintech being touted as the new, bright star in the Indian startup ecosystem, digital payments companies have been trying to push ahead despite having to contend with the cash mindset, changing regulations like mandatory KYC compliance for all users, and evolving market challenges. The reason is that they see light at the end of the tunnel —the Indian Fintech software market is poised to touch USD 2.4 Bn by 2020 from the current USD 1.2 Bn in the Financial Year (FY) 2016. Digital payments in India are on the verge of reaching $1 Tr by 2023.
According to Inc42 DataLabs, the number of deals in the fintech segment has been growing significantly since 2014. The sector started out with just 26 deals in 2014 but in 2017, 111 fintech deals were reported. The growth continues as according to the Indian Tech Startup Funding Q1 2018 report, fintech witnessed the highest funding among all sectors.
However, with giants like Paytm and PhonePe sewing up the urban market, startups like OmegaOn may have no option but to target a population that wants to make payments without OTPs, passwords, and bill details.
And there is a lot of scope for that, starting right from our homes. “My biggest turning point was when I got my mother, who is uneducated, to use the PhotoClickPay app and pay an electricity bill by simply finding the bulb picture and tapping on it. Then, without me urging her, she found and tapped the Airtel logo and paid her mobile bill. In one minute, an uneducated person paid two bills for the first time ever,” wraps up Sreekanth.