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(DAY 75) Last mile delivery of digital services in Bharat

· 5 min read
Gaurav Parashar

Bharat vs India

Bharat and India are two distinct facets of the country, differing significantly in various aspects. Firstly, in terms of population density, India is densely populated, with bustling cities and towns teeming with people, while Bharat has a comparatively lower population density, with vast open spaces and scattered villages. Secondly, infrastructure and amenities vary greatly. India boasts of modern infrastructure, well-developed transportation networks, and access to healthcare and educational facilities. In contrast, Bharat often faces infrastructure challenges, limited access to basic amenities, and inadequate healthcare and educational resources. Another crucial difference lies in the lifestyle and occupations. India tends to have a more cosmopolitan and fast-paced lifestyle, with diverse professional opportunities in industries, services, and technology. Bharat, on the other hand, follows a predominantly agrarian lifestyle, with farming and agriculture as the primary occupations. Additionally, cultural practices and traditions may also differ significantly between rural and India. However, it's essential to note that both rural and India contribute to the country's social, economic, and cultural fabric, each offering unique strengths and challenges.

Digital access of Bharat vs India

Bharat has grown leaps and bounds vs India in data consumption. Triggered by Reliance Jio’s entry in 2014, India’s data consumption has exploded with all other operators also offering cheap data tariffs. Mobile data traffic is growing as more Indians spend time streaming live videos, which is expected to account for 75% of overall mobile traffic by 2024. Read more.

Digital transactions in India

The table below rehashes the, Digital Transactions in India report. Digital Payment modes considered are: BHIM-UPI, IMPS, NACH, AePS, NETC, debit cards, credit cards, NEFT, RTGS, PPI and others.

Financial YearA. Population (in cr)B. Count (in cr)C. Total Value (in lakh cr)Avg Value in lakh (C/B)Count per person (B/A)Value per person in lakh (C/A)
2017-18135.41962071₹ 1,962₹ 0.9515.29₹ 14.49
2018-19136.90033134₹ 2,482₹ 0.7922.89₹ 18.13
2019-20138.31124572₹ 2,953₹ 0.6533.06₹ 21.35
2020-21139.63875554₹ 3,000₹ 0.5439.77₹ 21.48
2021-22140.75648840₹ 3,021₹ 0.3462.80₹ 21.46
2022-23141.71739192₹ 2,050₹ 0.2264.86₹ 14.47

BHIM UPI has emerged as the preferred payment mode of the citizens and has recorded 803.6 crore digital payment transactions with the value of ₹ 12.98 lakh crore in January 2023 => Average transaction value on UPI in Jan 2023 was Rs 1615.

Digital transactions learnings

The following are important learnings from the above data:

  1. UPI has massively increased the number of transactions, average transaction per person and reduce the average value of transaction i.e. introduced micro transactions.
  2. CAGR of Count per person i.e. number of transaction per person in India is 27% i.e. doubling every 3 years.
  3. It is shocking to see that the total value of Digital Transactions has a CAGR of 0%. The total transactions grew and peaked during Covid and shrank again.
  4. The average number of transactions per person in a year are only 65 i.e. 5.4 transactions per person or one transaction every 2 months. I wonder how the stats will look if you take away the power users i.e. the top 1% of population.

Bharat and Financial Digital Services

I met Neha Singh Rana who is the Chief Business Officer of Pay Point. Paypoint delivers financial services to the last mile i.e. they are GIG + Financial Services where they empower the dealers (independent contractors) to educate & enable transaction for their neighborhood. The services include - Kiosk Banking, M-ATM / AEPS, Instant Money Transfer, Pre-Paid Reloadable Cards, Bill payment & Recharges, Amazon Retail Store, PAN Card, Insurance, IRCTC & Travel Booking, Gift Vouchers & OTT. PayPoint claims to have a retail network of 64,000 shops and is one of the forefront players to do offline to online transformation for Bharat.

They are similar to e-Mitra in Rajasthan. Do you remember the days when we used to visit a shop for recharging the mobile phones in the early 2000s? If you step out a few kilometers outside the city and you will find people seeking help to perform transactions. I wonder how much of this digital literacy be disrupted by YouTube and similar platforms whereby Bharat will feel confident in performing financial digital transactions. They are very confident in browsing videos and navigating content in a very short span of time!