Bringing trust into Indian mobile payments

A report out this week has predicted that India will see a tenfold increase in digital payments between now and the end of the decade. That will see a rise to $500bn annually and see the GPD of India rise by 15%. However, unless more trust is built between consumers and banks, this prediction might not come to pass.

Payment industry commentators have often pointed to economies such as India and China as places of great innovation and progress. Just as nature abhors a vacuum, so does economics. Where there is a gap in the market, it will be filled. And this is what has happened in countries such as India where mobile technology has offered financial services to those who previously lacked them.

Despite this, when it comes to online commerce in India, cash is still reigning king. Consumer fear of card fraud means that the bulk of online orders are still paid through cash-on-delivery[1].

To counter this, Indian banks are making moves to tighten up payment security. One response has been to turn to the SMS one-time-password (OTP)[2] with the Reserve Bank of India leading the way.

Regular readers of our blogs will know that the OTP is a far from ideal method of authentication. Account takeover and SIM fraud mean that there is no guarantee that the SMS is going to the legitimate holder of the account.

It is to be welcomed that banks in India are responding to this fear of payment card fraud by stepping up security. This boom in Indian ecommerce and digital payments will only be sustainable if consumers have confidence that their online payments are safe and their card details are secure.

Yet we do not believe that the OTP is the answer. As we have discussed, it’s not sufficiently secure, nor is it seamless. MYPINPAD is perfectly placed to solve this problem. Entering a PIN on mobile is safer and more secure than the OTP and helps solve the risks of account takeover and SIM fraud. Equally, it gives the user control over their transactions without having to wait for the bank to authorise it via the OTP.

We believe the vibrant and growing Indian market is ready for MYPINPAD and we are certainly ready for India.


[1] Practical Ecommerce

[2] The Financial Express