By Kumar Abhishek,
Founder & CEO, ToneTag
Once, my friend from Singapore asked me, “Why is it that in India, we get candies instead of balance cash?” We have all faced this situation many a time in our past, but have never given much thought to it. When I heard this question from my friend, I knew that it was an opportunity. While cashless transactions and mobile wallets have picked up in most parts of the world, in India, there are many who are yet to even reach card transactions. Working as a core banking service provider in Singapore, I saw this problem in a new light.
This was the trigger and I started conducting extensive research on the viability of digital payments in India. I came back to India to study the market, the usage patterns of customers and the problems they faced while conducting transactions. I travelled across India, interacted with people from urban as well as the rural landscape, gathering tremendous insights regarding the pain points of payments specific to these audiences and started working on means of solving these problems.
During my study, I found out that cash was the primary mode of payment in most sectors. Even B2B transactions happened through cash, especially in rural areas where the penetration of bank branch networks, ATMs and digital acceptance points were near-dismal. Most transactions in the agriculture industry are still carried out through cash, as it drives the supply chain in various other industries and smaller businesses. Because of this safeguarding, depositing and withdrawing cash is a logistical nightmare for most businesses and individuals. Cash also leads to a high number of unorganized sectors that lack appropriate book-keeping and have outdated business practices.
According to a World Bank Report of 2014, 21% of the world’s unbanked population lived in India. Despite having a bank account and payment cards, Indians living in rural areas were generally unable to use most of the banking services due to poor infrastructure. There are a limited number of bank branches, ATMs and POS terminals in rural India due to which the end user is forced to travel or use alternatives to formal banking. And from where I see it, the key reason for the lack of such facilities is largely the high cost of deployment and lack of inter-operability.
With this understanding to make India a cashless economy, I and my team came up with the concept of introducing contactless payments in India via NFC, IVR calls, etc. This was the main concept behind ToneTag. The whole idea here was to provide contactless payments solution in rural areas without Internet connection. Hence we chose sound waves as a mode to conduct payments.
We are perhaps the first in the country to provide such proximity-based contactless payment solutions using NFC and sound for which we have already filed for a patent. Being an innovative product in a business vertical which is still budding in India, my initial days as an entrepreneur were spent educating customers about the contactless payment landscape.
With the Indian start-up ecosystem growing constantly and with so many opportunities in hand, the time has come for aspiring entrepreneurs to launch themselves. Today, the acceptance level towards disruptive ideas is at an all-time high.
ToneTag is here to play a role in enabling our society and economy leap towards cashless or ‘less cash’. We have made mobile payments a reality for all, irrespective of whether our customer’s phone is connected to the Internet or offline. We expect to unlock a new channel for growth in the digital payments industry by enabling both online and offline contactless payments.
Feedback: abhishek@tonetag.com
