| | JULY 20209payments. It allows users to pay through Aadhaar number, UPI payment address or through ac-count number and IFSC code, thus minimizing the need to pay using debit and credit card which require PoS terminals and processing costs compared to BharatQR which just requires a merchant to display a QR Code. The beauty is that the QR Code is a standard code regardless of which bank's or credit card com-pany's app you use. The system also supports Dynamic QR code gener-ation which eliminates the need of entering the amount for payment.Wallets, on the other hand, re-quire users to load them with cash before they can be used. As soon as the user transfers cash into the wal-let, the funds transfer to the wallet provider until you use the funds. The wallet company not only bene-fits from the interest on the float it collects, the user account is deplet-ed even before (he/she) purchases anything. And then, there are mer-chant fees and charges based on the value of the transaction. When there are no credit risks, it is diffi-cult to understand their merchant charges. And why value based? The risk is not proportional to the transaction value, as the wallet provider already has your funds. At best, they could charge a fixed sum as an operations cost. Wallets present a rather inefficient way to manage payments for you and your merchant!From a merchant perspective (and users), the plethora of mo-bile wallets present their own op-erational challenge. Each has pro-prietary codes to be scanned and there is no interoperability. The customer and merchant experience is disjointed. Different merchants accepting payments via different wallets means users end-up carry-ing multiple apps on their phones and keeping them all charged with funds. While UPI could enable the interoperability of wallets allowing users to transfer funds from one wallet to another, RBI has allowed only banks to become Payment Service Providers of UPI service. Mobile wallets have not been given permission yet. PayTM got its licence to set up a niche bank so it can now pay interest on deposits. The PayTM Bank went live and PayTM Wallet became part of the Bank in 2017. This enabled PayTM to connect its systems with the UPI network. It is highly doubtful that the other wallet providers will be able to set up their own niche banks ­ so they will probably tie up with banks us-ing the UPI network. Even if we as-sume that all wallets will find a way of getting on to UPI, why would anyone want to put their hard-earned money into a mobile wallet and lose access to their own money even before they spend it. This is one of the key issues that could kill the Wallet.Increasingly, QR code-based payments are seen to be the most cost-effective way of expanding the digital payments footprint in Asia where traditional card based in-struments have failed. Regulators have also realised that if payment platforms are left to market forces, market participants will establish their own proprietary closed-loop systems, benefiting only the largest players. Regulatory efforts in In-dia, Thailand and Singapore have aimed to improve interoperability. I believe it is the end of the line for wallets that continue to work as isolated payment solutions with-out interoperability ­ it's the end of the line! Akshaya GaurDIFFERENT MERCHANTS ACCEPTING PAYMENTS VIA DIFFERENT WALLETS MEANS USERS END-UP CARRYING MULTIPLE APPS ON THEIR PHONES AND KEEPING THEM ALL CHARGED WITH FUNDS
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