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Cashing in on the rise in digital payments and smartphones, Mastercard, has launched an interoperable payments solution using a Quick Response (QR) code that allows one to scan the code and pay, irrespective of the card platform.
"One of the challenges that we have in India as compared to other markets is that till now the QR payments solutions wasn't interoperable (it can be used across dofferent card platforms), so in the long run we hope to evolve to that payments infrastructure," said Porush Singh, Division President - Mastercard, South Asia.
Mastercard, that operates a payment processing network, expects this mode of payment to take off as the cost involved is way lower than as compared to setting up Point of Sales machines (PoS). This comes at a time when both the Reserve Bank of India and the government is pushing the digital model of payments.
Mastercard has tied up with RBL Bank at the moment and is also looking at tying up with other lenders to integrate the Masterpass QR service with its mobile platform — the OnGo digital wallet. This wallet once downloaded will host a virtual prepaid card that customers can use for cashless transactions.
"We have tied up with auto rickshaws right now, we want to increase the number to 10,000 autos by the end of the year. And then we will look for several more used cases that have cash on delivery such as vegetable vendors," said James Anderson, Executive VP-Digital Payments and Solutions at Mastercard.
Even though similar technologies such as Near Field Communication or QR code hasn't taken off as banks had expected but Mastercard believes that the recent conditions of demonetisations and increase in digital payments will act as a catalyst and push such modes of payments.
Despite the fact that these payments solutions will see competition from wallet players, unified payments interface and cards, Mastercard expects the QR code payments system to take off as still a majority of transactions are still in cash and that spells an opportunity.
