Report of

Minor Research Project

Title:

“PERCEPTION ABOUT PAYTM- TURNING MOBILE

WALLETS DREAM INTO REALITY WITH SPECIAL

REFERENCE TO THANE CITY”

Academic Year 2017-2018

Financial Assistance: Dnyanasadhana Trust

Principal Investigator: Ms. Anita Dakshina

Assistant Professor,

Self-Finance Courses

Satish Pradhan Dnyanasadhana College, Thane

Co Investigator: Ms. Asmita More

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 “PERCEPTION ABOUT PAYTM- TURNING MOBILE
WALLETS DREAM INTO REALITY WITH SPECIAL
REFERENCE TO THANE CITY”

ABSTRACT

The last decade has seen tremendous growth in use of smart mobile phone and internet in India.
In present world smartphone plays a crucial role in day to day life of people. The technological
advancement and rapid growth in smartphone users gives exciting opportunity to Mobile-Wallets
Industry and makes smart phones as device. In India all the transaction are usually done through
liquid cash and hence e-commerce came up with the facility of online payment to give boost to
cash-less economy. The announcement of demonetization was a welcome move but has sent a
shock wave across India and it caused some major inconvenience to a common man. It has made
people to think about digital payment methods and slowly and gradually becoming cashless.

In India the digital payment habit has changed after demonetization, people were left with no
other option other than money transaction so Indian society has started moving slowly and
steadily from cash to online transaction system. It is the right time for everyone to change from
traditional payments system to digital banking system (Mobile Banking) by using either debit
cards or credit card which is replaced by E-wallet.

Mobile wallet usage awareness has spread among the people in India due to Government policy
of demonetization and this has forcefully induced the usage of mobile wallet .The tightened
security issues and reduced in risk factors will automatically increase the adoption of mobile
wallet. The usage of internet, mobile and Government initiative are ensuring the exponential
growth of digital payment such as paytm. Consumer’s positive perception has a positive impact
on adoption of digital payment. Demonetization has lead to huge opportunity for digital payment
and all the digital wallet companies have expanded their market share.

KEYWORDS – M-Banking, Paytm, Digital Wallets, Customer opinion.

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INTRODUCTION

E-Commerce is an essence of doing commercial transaction in our 21st generation. E-Commerce

means electronic commerce in which money transaction conducted electronically through
Internet. The next generation of E-Commerce is M-Commerce. Kevin Duffey firstly coined the
term of "M-Commerce" in 1997. According to him m-commerce is define as the delivery of e-
commerce capabilities directly into the consumer’s hand ,anywhere via wireless technology. In
simple words, doing transactions through wireless handheld devices such as mobile phones.
Nowdays , Paytm is one of the most popular form of m-commerce Industry. Paytm is an Indian
e-commerce website headquarters in Noida, India. The CEO and Founder of Paytm is Vijay
Shekhar Sharma. Paytm was founded and Incubated by one97 communication in 2010 as a
prepaid mobile recharge websites. Paytm is acronym for "Pay Through Mobile" with Android ,
Windows and IOS apps.In 2014 ,the company launched Paytm Wallet. Paytm Wallet is one of the
type of E-Wallet. "A digital Wallet i.e. E-Wallets refers to an electronic device that allows an
individual to make electronic commerce transaction." E-Wallets are cashless method of payment.
Now Paytm becomes India's largest mobile payment service platform with over 100 million
wallets and 10 million apps.Paytm is approved by Reserve Bank of India i.e. RBI and Bharat Bill
Payment System,(BBPS)which allows customers to do their transaction any time. The Firm
started by offering mobile recharges , adding bill payment ,giving facilities of book ticket and
shop online. Also paytm gives further latest facilities like transfer of money from Bank account
to Paytm account and its giving "9 languages" benefits to its customer. For further convenience
Paytm is starting "Paytm Banks". Since November 8, when the government announced its
demonstration drive, Paytm is likely to lead 2.9 billion Wallet transaction in 2016.Paytm is one
of the most trusted Recharge destination in India.

HISTORY

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 M- E-
BANKING/ PAYMENT
BANKING
E- (E-
BANKING WALLETS)
BANKING HISTORY

The history of banking began with the first prototype banks which were the merchants of the
world, who made grain loans to farmers and traders who carried goods between cities. This was
around 2000 BC in all over the country. Later, in ancient Greece and during the Roman Empire,
lenders based in temples made loans, while accepting deposits and performing the change of
money. Archaeology from this period in ancient China and India also shows evidence of money
lending activity.
During the 20th century, developments in telecommunications and computing caused major
changes to banks & operations and let banks dramatically increase in size and geographic spread.

E-BANKING
From banking to e-banking the initiative was taken while financial institutions took steps to
implement e-banking services in the mid-1990s, many consumers were hesitant to conduct
monetary transactions over the web. It took widespread adoption of electronic commerce, based
on trailblazing companies such as America Online, Amazon.com and eBay, to make the idea of
paying for items online widespread. By 2000, maximum of U.S. banks offered e-banking.
Customer use grew slowly and it took ten years for banking to reach e banking platform.
However, a significant cultural change took place after the Y2K scare ended. In 2001, Bank of
America became the first bank to top online banking customers, more than of its customer base.
Online customers proved more loyal and profitable than regular customers. Online banking
customers who use online bill pay and e-bill services are happier with their banks which
translates into deepened relationships.

E-WALLETS/ Mobile wallets

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Physical wallets have been used for umpteen years to carry our items of value. The wallets in the
previous time were a cloth bag with a string which could carry coins , rupees or other valuable
items to the market. Since olden times, humans have been mobile and always needed a container
to carry all their personal belongings wherever they went. Now the modes of transportation have
increased the mobility of human being all over the world. Different forms and shape of wallets
have been made and leather wallets are used in recent times. There are various sections in the
wallet to carry paper note, coin, credit card, debit card, license etc. Just as wallet have moved
from cloth to leather, letter to internet similarly we need to move from physical wallet to digital
wallet.

After the e-banking system the banking was made more easier by discovering the e
wallet system. A digital wallet refers to an electronic device that allows an individual to make
electronic transactions. It is also referred by other names like mobile money, mobile money
transfer, and mobile payment generally represents a payment services operated under financial
regulation and are performed from or via a mobile device. This can include purchasing items on-
line with a computer or using a smart phones to purchase something at a store. An individual’s
bank account can also be linked to the digital wallet. In other words, mobile money transfer
refers to any method of monetary exchange that utilizes the facility of a mobile device with
authorised support facility and conformation to defined and explained legal policy.
Technology updating and advancement have changed drastically. Technology caters to man’s
comfort and convenience. The main aim behind mobile wallets introduced is to people can use
their own smartphone for not only calling and searching but also for the booking a cab or movie
tickets, ordering food or groceries, etc. man can do everything with the use of their smart phones.
With the introduction of the concept of mobile wallets, it has become extremely convenient for
all categories person to make cashless transactions. And although a number of companies have
cropped up in India, offering consumers this product called ‘mobile wallet’, there is still a lack of
awareness among people about the concept and its utility.
Mobile wallet is a perfect substitute of physical wallet in which we carry money. It is online
platform which users can use to keep their money in it, like an bank account. It is a very simple
process where users need to make an account with a mobile wallet provider and after simple

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procedure they can able to do wallet transaction with the help of their smart phones. It is as
simple and convenient as handling our social accounts like “Facebook”, the user just needs to
sign in the account and make the payment.

Paytm

Paytm is one of the Indian e-commerce payment company and digital wallet system which was
launched in August 2010 and whose headquarters is in Noida, India. In 2010, the scenario was
different as they mostly carried cash and used cash payment system and online payment was
lesser than cash payment. Paytm company came up with a unique feature i.e Money pay through
mobile to the seller that indirectly affected the growth rate of online payment. It had a step to
step changes in the features of Paytm.

In 2010, it started as only prepaid mobile and DTH recharge platform. The features were added
time to time as people face inconvenience in day to day banking transaction and online payment
system. Later in 2013, it added data card, postpaid mobile and landline bill payments. The
journey of paytm wallet began in January 2014, company launched the e-
wallets and Indian railways and Uber added paytm as a payment option. The
new e-wallets system launched by Paytm was turned into mobile commerce
with online deals and bus ticketing. People faced some problems related to
day to day cash transaction and it discovered more uses like education fees,
metro recharges, electricity, gas, and water bill payments and it also started
powering the payment gateway for Indian Railways in 2015. In 2016, Paytm
launched ticket bookings of not only movies, events and amusement parks
ticketing but also the flight ticket , rail bookings and gift cards.
Our honorable prime minister Narendra Singh Modi announced the demonitisation of five
hundred and one thousand rupees bank notes which gave boost to online payment system. At the
end of the year 2016, Paytm was available in nine languages and also offered uses like mobile
recharges, electricity bills , travel, movies, as well as payments at grocery stores, fruits and
vegetable vendors, restaurants, parking, tolls, medicine shops etc.

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The percentage of Paytm users highly increased from 2010 to 2016, and the demonetization was
one of the reason behind the maximum paytm users were increased.

REVIEW OF LITERATURE

International status

• NCTJ-qualified journalist Rian Boden in his Report on Mobile wallet market in India
(2016) said that, "Paytm is the most popular mobile payment app among , Android
smartphone owners in Urban India"

• According to Mohammad AuwalKabir, School of Accountancy, University Utara

Malaysia (2015), “E-payment system is increasingly becoming a daring means of
payments intoday’s business world. This is due to its efficiency, convenience and
timeliness. It is a payment system that is continuously being embraced and adopted in the
financial system of both developed and developing countries with a view to simplify and
ease payments in business transactions”.

• Ngoc Doan,(2014) Finland, in this research paper reviewed that “Mobile wallet is rather a
new topic in this technology era and in order to make mobile wallet widely acceptable, it
requires much effort in terms of change from many related stakeholders, especially the
merchants who will have to adapt and change the traditional way of payment”

• Rajesh Krishna Balan, Narayan Ramasubbu, Giri Kumar Tayi, described “the
requirements and challenges of deploying a nationwide digital wallet solution in
Singapore and they discussed why Singapore is ready for a digital wallet and identified
the key challenges in building and deploying a digital wallet, supporting peer-to-peer
cash transactions between individuals using a digital wallet”.

• Adu, Cecilia Adurayemi, (2016), in their research paper said “ the introduction of
electronic banking in Nigeria has a strong influence on the development of payment
system. However, it involves commitment of huge amount of financial resources on
computer technology, telecommunication facilities and constant electricity. The ATM has

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 been the best and the most common means of effecting cashless policy in Nigeria by
learned and unlearned, poor and rich”

National Status

• According to Reporter Jubin Mehta (2015), Paytm is a silent but powerful contender that
has a first mover advantage on mobile.half of the Paytm's run rate will come from M-
Commerce market-place push.

• In an interview (2016) Vijay Shekhar Sharma (CEO of Paytm) said,”There is a high level
of dormancy in the bank account of lower-income group, as traditional bank treat these
as additions and not be "core" of their portfolio.”

• Prem Kumar (2015) in his article has opined“The cashless transaction system is reaching
its growth day by day in India and markets have become globalised and the growth of
banking scheme shows more and more people moveing from cash less transaction.”

• S. NazimSha, Dr. M. Rajeswari, in this research reviewed that,” Paytm is one among the
best mechanical advancement in the present century and the administrations offered by
Paytm helps in time utilization. Fruitful treatment of Paytm by purchasers and shippers is
the best case of its positive effect in the general public. Paytm is the best case of an
organization which used online business in advertising better”.

• Dhanajay. B. and Suresh Chandra B. (2015) in this article reviews that electronic
payment system has progressed in the recent year in so many countries and India also.
The RBI was its vision statement has set the objective to promote electronic payment and
less cash economy.

• Dr. Poonam Painuly and Shalu Rathi (2016), in this research paper researchers found that
there is business, social and economic perspective in the growth of mobile money. The
presence of mobile wallet is spreading from urban to rural areas on a large scale. Hence
wallet money experiences a bright future in near time. There will be higher penetration in
small business with rurak as well as urban areas as it helps in gaining large customers.

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 • DR. S. Manikandan, J. Mary Jayakodi, (2015) says that, “Mobile wallet usage awareness
as spread among the people in India due to Government policy of demonetization and this
has forcefully induced the usage of mobile wallet .The security issues are tighten and risk
factors are reduced will automatically increase the adoption of mobile wallet and the
issues the convenience and ease of use as gained an credit to mobile wallet and it can be
concluded that they will be a tremendous growth in adoption of mobile wallet in the
forthcoming years.”

OBJECTIVES

 To study the benefits and limitations of Paytm from customers point of view with respect
to Thane city.

 To analyse the growing adaptation of Paytm.

 To evaluate the importance of Paytm Wallets.

HYPOTHESIS

 H0 : There is no growing adaptation of Paytm services.

 H1 : There is growing adaptation of Paytm services.

 RESEARCH METHODOLOGY

 Research universe is Thane City.

 Method used is Sampling method.

 Sample size is 200 people.

 Data collection method – data was collected from both primary and secondary sources

 Primary data is collected by Pre-structured questionnaire method.

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  Secondary data is collected through newspapers and internet.

 Graphs and Charts and Tables used for Data analysis technique.

ANALYSIS AND INTERPRETATION OF DATA –

In following questionnaire the researcher administered questionnaire to 200 people irrespective

of whether they use paytm or not. Out of 120, only 80 people said yes. In the questionnaire, five
questions were related to the paytm users.

1. Customer’s usage of paytm

a. Yes 120 60%

b. No 60 30%
c. don't know 20 10%

People using paytm

Yes
10% No
Don’t know
30%
60%

The fig.1 shows the number of people using paytm. Out of sample
respondents, majority of 60% people use Paytm, 30% people do not use
Paytm followed by 10% of people not knowing about Paytm because of lack
of awareness about Paytm.

2. Customer’s opinion on purpose of Paytm

a. Recharge and Pay 68 39%

b. Book Tickets 24 14%

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c. Shop Online 16 09%
d. Transfer of money 40 23%
e. All of the above 28 16%

Purpose of paytm usage

Recharge & Pay
Book Tickets
16% Shop online
39% Transfer of Money
23% All Of These
9%14%

Fig.2 shows the purpose for which people use Paytm on continues basis. Out
of majority 39% users use paytm for recharge and making Payment, 23%
people use Paytm for transfering money. 14% users use Paytm for booking
tickets. 9% users use Paytm for online shopping and 16% users use all the
services.

3. Customer’s opinion of paytm in daily use.

a. Roadside Vendors 68 27%

b. Retail shopkeepers 68 27%
c. Travelling 56 22%
d. Restaurant / Hotel 36 14%
e. Making govt. Payment 24 10%

daily usage in paytm

Roadside Vendors Retail Shopkeeper
Travelling Restaurent/Hotel
10%
14% 27% Making GOVT
Payment
22% 27%

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The fig.3 show majority respondents (27%) using paytm at Roadside vendors, 27%
users using paytm at retail shopkeepers whereas 22% users like to use paytm while
Travelling. 14% would like to use at restaurant and remaining 10% would like to
make Government payment through paytm.

4. Customer’s opinion on the reason for not using paytm.

a. Slow and unstable internet 04 03%

b. Lack of infrastructure to accept paytm 24 13%
c. Awareness about paytm 104 58%
d. Trust and security / safety 40 22%
e. Familiar with another options like (mobiwik, 08 04%
freecharge)

Reason of not using paytm

Slow & Unstable
Internet
Lack Of Infrastructure
4% 2% To Accept PAYTM

22% 13% Awareness About

PAYTM
Trust &
Security/Safety
Familier With Another
58%
options

Figure 4 shows the reason behind people not using paytm. Majority of 58% users
think that the reason would be lack of awareness about paytm, 22% cite trust or
security issue with paytm. 13% thinks that lack of infrastructure to accept paytm.
4% think that people are familiar with another option and 2% cite slow and unstable
internet behind people not using paytm .

5. Customer’s opinion on further feature or update required for Paytm app.

a. Improved further security. 44 25%

b. Large Payment 04 02%

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 c. No requirement 04 02%
d. Without internet 28 62%
e. Personal suggestions 16 09%

Further feature to be added

Improved Further Large Payment

9% Securities
25%
No requirement Without Internet
2%
Personal suggestions
2%
61%

Fig.5 shows user’s suggestion on what kind of further updates or features they
want. Majority 61% users wants the paytm app should run without internet, 25%
users want improved further securities ,9% people gives their personal suggestions
on paytm.3% people want that paytm should provide large payment facility and 2%
users feel there is no requirement of updation.

6. Customers opinion on e-wallets replacing cash.

a. Yes 96 80%
b. No 20 17%
c. don't know 04 3%

e-wallets replacing cash

Yes
17%3% No
No comment
80%

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Figure.6 shows number of people who think mobile wallets can replace cash in India.
Majority 79% users believe that it will , 16% users don’t think so and 3% people
does not have any opinion on these.

CHALLENGES

After revolution in M-banking the further steps includes the new concept of mobile wallets.
Mobile wallet is a recent phenomenon. Its adoption will take time as it is a habit change
experience for users as they are migrating from cash to wallet experience. Even though it might
be a relatively a newer concept, the adoption is increasing along with the awareness of it.

In the future , we may witness exit of some players or consolidation of some players from their
segment. They will pose new challenges which has to be taken care of so all the stakeholders
have to address these challenges to ensure the growth in customer base , volume of transaction
and profitability of business.

A large proportion of India’s population is not financially literate and does not have access to
formal banking services. There are multiple problems faced by the industry which can be viewed
as three dimensions. : business & operating models, consumer and market dynamics

The long-term profitability of certain models is yet to be ascertained. At the same time, most
non-bank payment service providers are in the early stage of business maturity, with an evolving
operating model. On the consumer side, there is still a strong preference for traditional modes of
transaction, especially cash. Digital payments, cards, and acceptance infrastructure at merchants
are largely an urban phenomena, and there is a huge urban–rural divide to be bridged.

There is large unhealthy competition in which leading players will be competing for the same set
of customers resulting in significant pricing pressures. They all are vying for same set of
customers.

Competitors of paytm

Some of the vompetitors of paytm:

 Freecharge
 Mobikwik

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  State Bank Buddy
 ICICI Pockets
 Airtel Money

FINDINGS

 Majority of respondents use Paytm and few do not use because of lack of awareness
about Paytm.
 Majority users use paytm for Recharge and making Payment, transferring money,
booking tickets and online shopping .
 Respondents would like to use paytm at Roadside vendors, Retail shopkeepers , travelling
, Restaurant and to make Government payment.
 The reason behind people still not using paytm is lack of awareness, lack of trust or
security, lack of infrastructure to accept paytm, slow and unstable internet.
 Majority of people think mobile wallets can replace cash in India

SUGGESTIONS

 There is a 4% interest charge on services provided by paytm. So to avail more customer

paytm should minimize or avoid there charges.

 Paytm should provide internet or wifi facility to vendors who provide paytm facility to
their customer.

 paytms should look into recharge coupon being available in rural areas so people can use
paytm even if they do not have bank accounts.

FINDINGS AND CONCLUSION

 Out of sample respondents, majority of 60% people use Paytm, 30% people do not use
Paytm followed by 10% of people not knowing about Paytm because of lack of
awareness about Paytm.
 Majority of 39% users use paytm for Recharge and making Payment, 23% people use
paytm for transferring money. 14% users use paytm for booking tickets, 9% users use
paytm for online shopping and 16% users use all the services.

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  Out of all the respondents, 27% users would like to use paytm at roadside vendors, 27%
users like to use paytm at retail shopkeepers where 22% users like to use Paytm while
Travelling. 14% would like to use at restaurant and remaining 10% would like to make
Government payment through paytm.
 Majority 58% users think that the reason would be lack of awareness about paytm ,22%
thinks that the reason would be that there are some trust or security issue with paytm.
13% thinks that lack of infrastructure to accept paytm.4% thinks that people are familiar
with another option and 2% thinks there would be slow and unstable internet.

 The number of peoples who think mobile wallets can replace cash in India. Majority 79%
users believe that it will replace cash and 16% users don’t think so and 3% people does
not have any opinion on these.

 Hence we reject null hypothesis as we can see that there is growing adaptation of paytm
services partly due to demonetization and partly due to the adaptation to the technology.
People have started relying on these services and getting used to the convenience what it
offers.

 REFRENCES
 The Newspaper -Times of India on 22nd Nov, 2016.
 The Newspaper –Economics Times on 23rd Nov, 2016.
 https://www.google.co.in/search?
q=paytm&oq=paytm&aqs=chrome..69i57j0l5.1677j0j8&sourceid=chrome&ie=UTF-8#
 www.nfcworld.com/2016/03/14/.../nielsen-reports-on-mobile-wallet-market-in-india/
 AN EMPRICAL STUDY ON CONSUMERS ADOPTION OF MOBILE WALLET WITH
SPECIAL REFERENCE TO CHENNAI CITY DR.S.Manikandan*1 , J.MaryJayakodi 2
 A STUDY ON “ELECTRONIC PAYMENT SYSTEM” - “E-WALLET” G.UDHAYARAJ#1 and
D. JOCIL*2
 A Study On Paytm Services In Promoting Cashless Economy After Demonetization In IndiaAnd
An Outline On Its Support Towards MakingIndia Digital
 S. NazimSha*, Dr. M. Rajeswari** * Research Scholar, School of Management, Hindustan
Institute of Technology and Science, Padur, Chennai India. – nazimsha.s1992@rediffmail.com

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  **Associate Professor, School of Management, Hindustan Institute of Technology and Science,
Padur, Chennai India. – mrajeswari@hindustanuniv.ac.in
 Digital Payment Habit has changed after demonetization. People have no other option for
transaction so Indian society move slowly from cash to digital transaction system.
(PDF) DEMONETIZATION AND ITS IMPACT ON ADOPTION OF DIGITAL PAYMENT:
OPPORTUNITIES, ISSUES AND CHALLENGES. Available from:
https://www.researchgate.net/publication/317283897_DEMONETIZATION_AND_ITS_IMPAC
T_ON_ADOPTION_OF_DIGITAL_PAYMENT_OPPORTUNITIES_ISSUES_AND_CHALLE
NGES
 Mohammad AuwalKabir*, SitiZabedahSaidin, AidiAhmi
 School of Accountancy, Universiti Utara Malaysia
 STUDY OF CONSUMER PERCEPTION OF DIGITAL PAYMENT MODE SHAMSHER
SINGH Banarsidas Chandiwala Institute of Professional Studies, Dwarka, New Delhi, India Tel:
9810543144; Email: shamsher_1965@redfiimail.com RAVISH RANA Delhi School of
Economics, University of Delhi, Delhi,
 https://www.financialexpress.com/industry/technology/emergence-of-e-wallets-in-india-here-is-
how-the-payments-industry-is-growing-rapidly/451008/
 http://www.iamwire.com/2015/04/mobile-wallets-what-scope-india/114860
 https://www.sumhr.com/digital-wallets-india-list-online-payment-gateway/

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