After steep learning curve, a shopkeeper in Delhi now swears by digital payments

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New Delhi: For 54-year-old Naresh Guliani, who owns and operates a grocery store in a residential complex in south Delhi, the 8 November scrapping of Rs500 and Rs1,000 notes marked the start of a steep learning curve.

Left in the lurch with little cash to pay suppliers, Guliani was initially saved by old ties to his customers and wholesalers. He accepted cheques from his customers and received credit from suppliers. But the need for small-denomination cash in day-to-day transactions proved to be a problem. That is when he started receiving queries about Paytm from customers.

After opening his shop in 1986, Guliani had avoided digital modes of payment like debit or credit cards, preferring cash and cheques. But as the cash crunch following demonetization persisted, Guliani explored e-wallets.

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“After demonetization, there was a sudden shortage of change. A customer then told me about Paytm. I went to my daughter, who set up the account for me and helps me with transactions. After 15 days, I am now comfortable using the application on my own. It has made doing business much easier,” he said.

He says more customers have been enquiring about e-wallets like Paytm.

“In just 15 days, I have 8-9 customers who only pay through Paytm and have already done 20 transactions. One customer even paid an amount as low as Rs2 using Paytm when he realized he was short of cash,” he said.

To be sure, the transition has not been without glitches; it has been a constant learning experience for Guliani and his family.

“Recently someone came and they wanted to pay through Paytm using their bank account. We had to figure out the process. We went home, researched online and then finally managed to understand how it will work. People are coming out with different options and we are learning to use them,” said 18-year-old Mehak Guliani, who coached her father about the app initially.

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E-wallets like Paytm have been among the biggest gainers from the push towards a cashless economy, encouraged by the demonetization of high-value currency notes that was also aimed at curbing corruption and black money. People have time until 30 December to deposit old notes, but strict limits have been placed on withdrawals.

Paytm currently has a merchant base of 1.5 million, including retail outlets and chain stores. Since 8 November, the company claims to have seen a surge in traffic, average transactions and app downloads.

Of course, Guliani, whose monthly sales are around Rs1.5 lakh, does not expect cash and cheque payments to come to a stop. Since his shop is in a residential area, around 40% of his transactions are through cheques from customers who live in the neighbourhood.

“These are long-term relationships built out of mutual trust. Some may choose to start paying by electronic means, but cash and cheques will also continue,” he said.

Although Guliani’s customers have been asking about cards, e-wallets and even bank transfers through e-wallets, his suppliers continue to use cash for transactions, a habit he is trying to change. “I still have to use cash for the back end from where I get my supplies. I am telling my suppliers that they should shift to a platform like Paytm,” he said.

He is paying personal bills through the app and is getting his family to change too.

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He tells us to book our movie tickets through his Paytm now, pointing out that we will get a cashback for every purchase,” said Mehak.

Guliani is also looking to acquire a point-of-sale (PoS) terminal to offer another digital transaction option to his customers. He has approached a couple of banks, but has been told to wait for a month.

Operating a PoS terminal will be a challenge, given poor Internet connectivity, which may also impede the government’s drive for less cash in remote rural areas.

The government has adopted a five-pronged strategy, using a mix of Aadhaar-enabled payment systems, the unified payments interface, debit and credit cards, and unstructured supplementary service data, or USSD, for non-smartphones and e-wallets to combat the post-demonetization cash crunch.

Guliani says he supports the government’s move despite the hardships that demonetization led to.

“It is a great step by the government. But there is no denying the fact that there are problems and people are being troubled,” he said, adding that he is willing to give PM Narendra Modi the 50 days he asked for until 30 December to restore normalcy.

“Slowly money is beginning to come back to the market. People can slowly start going back to their normal routine,” he said.