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Study of E-wallet Awareness and its Usage in Mumbai

Article  in  Journal of Commerce and Management Thought · January 2018

DOI: 10.5958/0976-478X.2018.00004.6

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 Journal of Commerce & Management Thought
Vol. 9-1, 2018, pp 33 - 45
DOI : 10.5958/0976-478X.2018.00004.6

Study of E-wallet Awareness and its

Usage in Mumbai
Bhagyashri R. Pachpande, Aakash A. Kamble

Abstract
E-wallet is a type of card which works electronically and also which is used
for transactions made online through a computer or a smartphone. Its utility
is same as a credit or debit card. Virtual cash or Cashless Transaction is an
upcoming technology that has seen a tremendous growth in the past year.
Cashless payments are now becoming a popular trend in almost every field.
Demonetization has forced a lot of places to accept digital payments. Use of
e-wallets helps in moving away from a cash based economy. In the process,
all the transactions get accounted in the economy, which has the effect of
reducing the size of the parallel economy. The presence of mobile wallet
spreading from urban to rural areas on a large scale. Hence, wallet money
sees a high bright future in near time. The present study tries to study and
analysis of the usage of E-wallet.
Keywords: E-wallet, Cashless Transaction, Virtual cash, Smartphones,
Demonetization, Micro payments, E-Commerce, Failure payment transaction

33
34 Journal of Commerce and Management Thought 9 - 1

INTRODUCTION
The digital revolution continues to transform most aspects of our daily
life. In particular, the digital revolution has resulted in the vertical convergence
of business channel capacities. The digital revolution also continues to
transform the public sector organizations and services.
A next step in the digital revolution is the transformation of the time
honored traditional physical wallet into the e-wallet.
Virtual cash or Cashless Transaction is an upcoming technology that has
seen a tremendous growth in the past year. Cashless payments are now
becoming a popular trend in almost every field. Be it E-Commerce websites
or DTH recharge. Cashless services are proving to be the future of transaction
services, with minimum or no use of physical cash. It is also being considered
an alternative to plastic cash.
E-wallet is a type of electronic card which is used for transactions made
online through a computer or a smartphone. Its utility is same as a credit or
debit card. An E-wallet needs to be linked with the individual’s bank account
to make payments. E-wallet is a type of pre-paid account in which a user can
store his/her money for any future online transaction E-wallet has mainly two
components, software and information. The software component stores
personal information and provides security and encryption of the data. The
information component is a database of details provided by the user which
includes their name, shipping address, payment method, amount to be paid,
credit or debit card details, etc.
Demonetization has forced a lot of places to accept digital payments.
MobiKwik, Paytm, and FreeCharge are being accepted at toll plazas; in
Mumbai, FreeCharge is an option for paying police challans. MobiKwik is
accepted by , Paytm supports flight tickets within the app. Reliance Jio plans
to get 10 million merchants on board for its Jio Money Merchants solution. All
of these apps are aggressively targeting smaller merchants to ensure they are
accepted at more and more places. Your neighborhoods grocer might have
switched already.
 Study of E-wallet Awareness... 35

Also BHIM (Bharat Interface for Money) is a developed by (NPCI),

based on the (UPI). It was launched by , the , at a Digi Dhan mela at in on
30 December 2016. It has been named after and is intended to facilitate e-
payments directly through banks as part of the and drive towards cashless
transactions.

Operational Mechanism
Under electronic wallet, the individual pre-loads cash in the e-wallet and
use it to make payments or transfers. Loading of money is done either
electronically using a computer / mobile by debiting from a credit card or bank
account or physically by handing over cash at a local merchant (point of sale
[POS]) or at the ATM counters. What is required is an internet connection and
a mobile /computer. With the technology in place, mobile based operations
through e-wallets have become a mode for financial inclusion.
There are charges for use e-wallet, which include registration fees and
cash loading charges (above a limit) towards payment companies / service
providers. These charges are at times higher than those for internet banking.
However, the main advantage with the e-wallet is that while shopping online,
the customer stands to benefit from the concessions/ offers from the payment
companies in the form of cash-backs etc. The use of e-wallets substantially
reduces the cost of doing banking transactions. Through e-wallets small and
micro payments covering a large number of people.

Benefits of e-wallets
Use of debit cards requires access to designated point of sales and ATM
counters. However, in case of e-wallets, money moves along with the holder
and he can access it from an instrument held in his hand – his mobile or
computer, giving a lot of flexibility for the account holder. Further e-wallets
avoid the dangers associated with card thefts.
For those who stay far away from the brick and mortar ATM / bank
branches, as in the case of rural areas, money is still accessible to them at the
click of a button. In case of any requirement for physical cash, they just need
to go to the nearby banking correspondent or a local merchant who can double
up like an ATM machine.
36 Journal of Commerce and Management Thought 9 - 1

Thus, e-wallet comes handy for those who do not have a bank account,
net banking or credit card, especially those who may otherwise be in-eligible
for receiving them. At present, services are not generally designed to handle
big payments.
The use of e-wallets substantially reduces the cost of doing banking
transactions. Through e-wallets small and micro payments covering a large
number of people (eg. entry fee of Rs. 10/- to a monument, application fee
such as the fees of Rs. 10/- under the Right to Information Act, 2005, utility
bill payments etc.) can be cost effectively carried out. Effecting such
transactions through the normal/traditional route would be burdensome for the
banks, requiring more people to be employed at their counters.
The use of e-wallet has been very successful in Kenya through , where
millions of people are estimated to be using this service to transfer small
amounts of money to other people and merchants via their mobiles. In Kenya,
this has been facilitated by the support of large number of agents and business
correspondents.
Use of e-wallets particularly facilitates e-commerce as customers are not
required to fill out order forms at each site when they purchase an item as the
information has already been stored and is automatically updated and entered
in the order fields across merchant sites.
Use of e-wallets helps in moving away from a cash based economy. In the
process, all the transactions get accounted in the economy, which has the effect
of reducing the size of the parallel economy.

Applications
There will be various applications of e-wallet. These can be as follows:
• Bill payments
• Money transfer
• Faster payments in shops
• Ticket booking (Air, Train, Bus)
• Bank account management
• E-Commerce
• M-Commerce
 Study of E-wallet Awareness... 37

The idea of an E wallet is not new. Indeed, Japan, America, Sweden and
South Korea have already rolled out cell phone-based digital wallet solutions.
Consumers in those countries can use their cell phones to pay for groceries,
order drinks from a vending machine, and even identify themselves at airline
ticketing counters

Literature Review
An article that was published on 1st of July 2015 in The Economic Times
stating that “Whether you have to pay for a taxi ride or teach your child the
basics of managing money, a preloaded mobile wallet could be the answer.”
Rajesh Krishna Balan, Narayan Ramasubbu, Giri Kumar Tayi studied in
their paper “Digital Wallet: Requirements and Challenges” (2006) that the
requirements and challenges of deploying a nationwide digital wallet solution
in Singapore. Further they discussed why Singapore is ready for a digital wallet
and identify the key challenges in building and deploying a digital wallet. Then
discussed one of the key challenges, supporting peer -to-peer cash transactions
between individuals using a digital wallet, in more detail and end the paper
with their proposed solution.
Dr. Poonam Painuly, Shalu Rathi in their paper “Mobile Wallet: An
upcoming mode of business transactions” (May 2016) has explained about
mobile wallet, types and trends. Then discussed about Role of mobile wallet
in various sectors like Banks, Retail and Hospitality. The paper explains the
importance of mobile wallet for Banks, Customers and Companies. In future
scope it talks of mobile wallets becoming a latest marketing channel in near
future. And contribute highly in a seamless shopping experience for the
customers that increase their tendency for frequent and more repurchases with
delightful experiences. To conclude they speak the importance and growth of
mobile money in business, social and economic prospective. The presence of
mobile wallet spreading from urban to rural areas on a large scale. Hence,
wallet money sees a high bright future in near time.
Prof Trilok Nath Shukla in his paper “Mobile Wallet: Present and the
Future” (June 2016) has discussed about mobile wallet, working, types and
its advantages and disadvantages. His analysis included perception of
38 Journal of Commerce and Management Thought 9 - 1

consumers and retailers about mobile wallets. He concluded that mobile

wallets will be used to engage with the customer by the marketers and digital
businesses. Irrespective of the market status of these mobile wallets, marketers
should take advantage of the emerging opportunities.
An article that was published on 9 December 2016 in The Indian Express
under Brand solution section stated that Digital wallets are for those with some
experience of the way digital transactions work. The unlettered, the elderly,
and those without smartphones will be largely left out. Poor connectivity and
patchy Internet are serious challenges.
Pralay Mondal, Senior Group President, Retail Banking, Yes Bank, said
“Prepaid wallets will increasingly replace cash in the near future. They will not
replace debit or credit cards, but will be used for specific needs and micro
transactions.”
The balance in semi-closed wallets which are issued by non-banking
entities like Paytm, Mobikwik, Oxigen and ITZCash, cannot exceed Rs 1 lakh.
Unless offered in association with banks, you cannot use your mobile wallets
for cash withdrawal

Research Methodology
The aim of this research paper is to analyse the usage of E wallet by users.
In order to reach the aim a structured questionnaire was sent to 150 People
The respondents were categorized on the basis of,
• Frequency of E-wallet usage
• Usage of E-wallet before and after Demonetization
• Purpose of using E-wallet
• Devices on which E-wallet used
• Average monthly spending on E-wallet
• Failure in payment transaction
• Customer satisfaction level on the basis of Ease of use, Transaction
Time, Privacy,
Out of 150 people only 104 responded to the questionnaire. The peoples
have been selected by random sampling method.
 Study of E-wallet Awareness... 39

Data Analysis
The analysis of the collected data is done based upon the parameters as
shown below [Sample size = 104]
Out of total sample population i.e. 104 respondents, 69.2% and 30.8% of
total sample population were male and female respectively.

Majority of the sample population i.e. 104 respondents were from the age
group of 21 – 30 and contributed 63.5% of the total sample size. 15.4% of the
40 Journal of Commerce and Management Thought 9 - 1

population was between the age group of 41-50 and 11.5% of population was
between the age group of 31-40 and 9.6% of population i.e. 9 respondents
were between the age group of 15-20.
Out of total 104 respondent, 49 were students, 42 were salaried while 8
were self-employed and 5 were not working.
Out of total 104 respondents, 33 respondents (31.7%) use E wallet few
times a month, 29 respondents (27.9%) use once in a month, 18 respondents
 Study of E-wallet Awareness... 41

(17.3%) use few times a week and 4 respondents (3.8%) use once in a day
while 20 respondents (19.2%) never used E- wallet.
Since the world is shifting towards mobile applications because
everything can be done just using a click and also people want services to be

available in all the conditions and at all times so almost all of the respondents
use E-wallet mobile app.
The response to since when you are using wallet seems to contrast the
42 Journal of Commerce and Management Thought 9 - 1

general notion as a higher percentage of the people started using the wallet
pre demonetization i.e. from last one year.
Majority of the respondents (nearly 80%) use E-wallet for all facilities

which are provided by E-wallet since it is very convenient to pay your utility
bills , booing travel as well as movie tickets anywhere without from standing
in long queues.
Since people are using E-Wallet for various purpose such as Recharge,
 Study of E-wallet Awareness... 43

Ticket booking and Payment of bills so majority of respondents (around 36 out

of 84) spend an amount more than 1000 monthly. 31 people spend an amount
between 500 to 1000 monthly 17 people spend an amount less than 500.
Around 36% people claimed that they faced some problem during their

transaction. This failure could be due to various reasons such as Payment

gateway failure, Problem with acceptance of Debit/Credit card.
QuestionsTotal ResponsesMeanEase of use844.43Quick transaction
44 Journal of Commerce and Management Thought 9 - 1

through E wallet843.38E wallets provides secured transaction843.04Personal

as well as transaction security844.01Useful offers or discounts offered by E
wallet843.89Customer service provided by E Wallet843.9
According to data obtained, response for ease of use is moving towards
strongly satisfied, for quick transaction, offers and discount, customer service,
personal security it’s moving toward satisfied while for transaction security
it’s moving towards neutral.

Nearly 77% respondents claimed that they will rcommend E wallet to

others which shows that respondents are happy or satisfied with E-wallet.
 Study of E-wallet Awareness... 45

Conclusion
E-Wallet is one of those programs which is a real pleasure to use and it
has been so well thought out. There are a host of features and the program
remains so very simple to use. Consumer can ignore all the customization and
use it just as effectively with the default settings and selections. Although e-
Wallet still have some disadvantages in term of interoperability and
standardization of security and formats but still e-Wallet is the best in
transaction application compare to others. As a result the three major factors
which play an important role in consumer adoption are convenience in Ease
of use, quick online transaction and usefulness of E-wallet. Users of E wallet
are satisfied with the services provided to them. But users are neutral about
transaction safety as 75% users claimed that they have faced the transaction
failure .The most adored feature of E- wallet is that it is a hassle free mode of
making an online payment. So, E wallet is performing well in terms of privacy,
transaction time, discounts, offers and customer satisfaction.

REFERENCES
• (2015) July 1st in The Economic Times “Definition of E wallet”
• Balan, R., Ramasubbu, N., Tayi, G. (2006) Digital Wallet: Requirements and
Challenges. Available:
• (2016) December 9 in The Indian Express under Brand solution “A kind of cash; e-
wallets and how they work”
• Dr Hem Shweta Rathore (2016) April. Adoption of digital wallet by consumers. Vol. 8
Issue 69
• Dr. Poonam Painuly, Shalu Rathi (2016) May. “Mobile Wallet: An upcoming mode of
business transactions” Vol 3 Issue 2
• Prof Trilok Nath Shukla (2016) June “Mobile Wallet: Present and the Future” (JMEIT),
Volume -3, Issue- 3

The Authors
Bhagyashri Pachpande is MBA student of Indira Global Business School Affiliated
to Savitribai Phule Pune University.
Aakash Kamble is Assistant Professor with Indira Global Business School, Pune,
and also pursuing PhD from Savitribai Phule Pune University. He is presently
working as research scholar at Bar Ilan University, Israel on research assignment.
Email id : kamble.aakash@outlook.com ● Received on : 25 Nov. 2017

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