The very nature of liquid currency or bank notes is its touch and feel trait , which for time being is a matter of great concern as a potential carrier of coronavirus during hand to hand transactions. Currency notes increase the risk of transmission and therefore health departments and experts across India are asking people to avoid touching cash and use digital payments.Recently the NPCI has urged Indians to use Digital Payments (“Indian Pay Safe” campaign) in a bid to reduce Social Contact. Both Public and Private Banks in India has also urged citizens to utilise Online and Mobile applications to process transactions and avail other services. Segments that are expected to adversely impact digital payments in India due to COVID-19 include Airlines, Travel/Tourism, Hospitality, Retail, Theatres, Restaurants, Clubs and Entertainment Parks (which form 40 % of the total digital payments in terms of volumes and value in India). Whereas sectors that will boost digital payments include small grocery stores, online money transfer, OTT, online gaming, online education, financial services segments, utility bills. (which forms another 60%).So it is a see-saw battle for the payments industry which has equal and opposite weightages of the COVID19 impact. According to industry experts, the digital payments sector in India is expected to become a USD 1 trillion market by 2023. The virus outbreak has only opened the doors for adoption/ innovation of digital payments interfaces across the country. WHO has so far not recommended banknotes would transmit COVID-19, nor has issued any warnings in this regard. But it certainly has stressed about washing the hands regularly.

Take the case of “All in One” solution by Paytm, that helps offline merchants accept payments even remotely. This mechanism is finding many takers among businesses as more merchants and users are coming on board for digital transactions. It enables Paytm to gain more traction during these lockdown month as compared to its peers UPIs. Different methods like Contactless Payments could be the way ahead and payment modes like UPI-QR, IMPS, RTGS, Mobile wallets and Net banking could contribute effectively in reducing human interactions. UPI-QR is the most effective contactless payments mechanism which is enabled fully online. In fact, the best way to do contactless payment is by using one’s own mobile phone apps like Google-pay, PhonePe or bank apps, or through scanning it via QR code. The ‘tap and go’ is the other most referred method for Contactless Payments, which is now available in almost all the debit cards. This can majorly replace further the old card swipe-in POS terminals, which involves a lot of hand to hand touching and transmissions. The benefit of touch and pay is that there is no requirement of PIN to be inserted in the point-of-sale machine, and payments up to Rs 2,000 can happen. Beyond which other modes of payment are always available for a customer like IMPS, RTGS and Net-banking to facilitate other large transactions.

As per industry observation, Razorpay’s report highlighted that UPI, internet banking and wallet payments have all grown in India because of quarantine and social distancing. According to its observations unified payment interface (UPI), internet banking and payments wallets are the top three modes of payments amid the covid 19 impact time period. The UPI payments have seen a 19.6% hike, followed by internet banking and wallet payments with 11.5% and 10.3%, respectively, during the month of mid Feb to March. The B2B fintech startup has also registered a 10% hike in the value of digital payments transactions. While that of government and utility bill payments have noted a 30% spike, meanwhile online grocery segment has also noted a 9% growth for the first time. While industry experts were anticipating to see a decline in digital payments with most business temporarily going on hold due to the coronavirus (Covid-19) pandemic and lockdown, the observations are exactly the opposite.