E-Wallets: Diffusion and Adoption in Indian Economy

Abstract

Mobile wallets can be viewed as the digital version of a physical wallet someone would carry. The mobile wallet revolution is well underway, but the winning providers are far from decided. The purpose of this paper is to understand the factors affecting the increase in user proportion and its significance in adoption of e-wallet and also the disparity in user proportion in metro and tier-2 cities. A total 285 valid responses as a part of pilot test are analyzed to establish the outline of the study. In November 2016 aftermath of demonetization affected the user base and increased the number of e-wallets adoption by small vendors in Mumbai area. Looking at the user perspective, the majority of the respondents uses e-wallets; the proportion of users in the metropolitan cities is more as compared to the tier-2 cities. In addition, the only significant variable for e-wallet adoption that was indicated was ‘Simplicity’, which implies the ease of use of the wallet payment system. Looking at the vendor perspective, the e-wallet adoption is much less than what had anticipated. One of the unexpected factors was the fact that the vendors are approached by the e-wallet representatives to adopt it.  Hence e-wallets have been adopted by the user population and are satisfied with it. The vendor market hasn’t been diffused into yet, and seeing the difficulties and problem they face, it seems difficult that they will be able to penetrate it in the future.