A RESEARCH STUDY ON SELECT CUSTOMERS PERCEPTION ON DIGITAL MONEY AND DIGITAL PAYMENTS

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1 A RESEARCH STUDY ON SELECT CUSTOMERS PERCEPTION ON DIGITAL MONEY AND DIGITAL PAYMENTS ABSTRACT Dr. S. NAGARAJU Associate Professor Gandhi Academy of Technical Education The digital payment changed the buying behavior of Public. It prevents black money market. It helps the government to maintain a record of all transaction. Digital Payment Habit has changed after demonetization. People have no other option for transaction so society moves slowly from cash to digital transaction system. On the earlier, when digital payment introduce people hesitate to change their transaction habits but after demonetization, they force to do their transaction with digital payment. This research is an encomium on the charisma of digital payment analysis after demonetization and its, its usability and affordability while they are affecting its preference of country. The way consumer perceives digital transaction after demonetization, it affects a lot in India. Keywords: Digitalization, Demonetization, Transaction, payments, Affordability. 1. INTRODUCTION Digital payment is a way of payment which is made through digital modes. In digital payments, payer and payee both use digital modes to send and receive money. It is also called electronic payment. No hard cash is involved in the digital payments. All the transactions in digital payments are completed online. It is an instant and convenient way to make payments. If we talk about cash payments, you have to first withdraw cash from your account. Then you use this cash to pay at shops. Shopkeeper goes to the bank to deposit the cash which he got from you. This process is time-consuming for you and also for the shopkeeper. But in digital payments, the money transfers from your account to the shopkeeper s account immediately. This process is automatic and neither you nor the shopkeeper is required to visit the bank. Page No:55

2 2. INNOVATIVE TYPES OF DIGITAL PAYMENT METHODS 2.1. NFC or MST transmission waves platform Companies have come up with making transaction through NFC (Near Field Communication) and MST (Magnetic Secure Transmission) technology. Without swiping your card through POS (Point of Sales) machines, you can easily make payment to merchants through its wireless transmitting magnetic waves. You can avail this facility by downloading MST enabled app and also, your phone should support NFC facility. Once it is done, after registering your card details, you can make contactless transactions through your phone on any of merchants POS terminal Digital wallet payment system Through this platform money is loaded in wallets. Similarly with the launch of e-wallets you can add money using digital wallet apps. However, the constraint is you can transfer fund to the same wallet only. It means that if you have Pay TM or SBI's Buddy app on your phone then you can only transfer money to another person's Pay TM wallet or SBI's Buddy app who is having these app's installed respectively. Simply in another way round, you cannot transfer money from Pay TM wallet to SBI buddy wallet app. There are some other e- wallets available in the digital marketplace such as Mobikwik, Freecharge, Oxigen, Reliance Money, Paypal, Buddy, Lime, Payzapp, Pocket, Yes Pay, etc. Digital Payments In India Name of Conference: International Conference on Paradigm Shift in Taxation, Accounting, 29 Page Finance and Insurance 2.3. USSD code payments system If you do not have a Smartphone or internet facility, still you can make payments through dialing USSD (Unstructured Supplementary Service Data) code even from your basic phone and following the certain instruction, you can easily make your payments done. It is GSM-based technology where transactions take place through messages. It is a platform which forms a medium between the telecommunication and banking financial services altogether. For every banking app, you have a different dialing code which you need to check from your service provider while making the transfer of payments Mobile Money Identifier MMID is a seven digit unique number which issued by the bank once you have registered your mobile number. A person who wants to send money and the person who wants to receive that money should have MMID for the particular interbank funds transfer. Page No:56

3 However, through MMID you can transfer only a small amount (around Rs 10,000) within a day. Almost all banks are providing this facility of making small payments UPI App based payments platform UPI has come up with a unique feature of creating virtual address through which you can transfer money without disclosing your account number and IFS code to the receiver. UPI works on a real time basis which means the money is transferred instantaneously. UPI also supports the other medium of doing funds transfer. UPI facility is available with all the banking apps like HDFC UPI, SBI UPI, ICICI UPI, AXIS UPI, and almost all the other private and public banks. Now, most of the banks are embedding their UPI feature within their mobile banking app only QR Code based payments system QR code is again a different mechanism of making the transfer of payment where you only need to scan the QR code of the merchant and do the transfer of payments. It is being mostly used by all the digital payments app like BHIM, other banking apps to make the transfer of payments easily. The black square holds the information about the items whereby scanning the code information gets transmits automatically through the Smartphone and payments get done. You do not have to enter anything manually while using QR code facility. Bharat QR code has been launched by the government to push the digital payment initiative in all the way round. 3. Advantages and uses of digital money and digital payment Digital payment methods are more convenient and is more secure compared to making transactions involving cash withdrawal. This method of payment promotes more transparency and accountability, reduce transaction costs, and decrease the size of the grey or informal economy No additional cost of printing cash - because during the demonetization phase RBI had to spend 7935 crores to print the newly designed cash Saves money and time-whereas physical cash leads to vulnerabilities of tax evasion, black money and fake currency, digital money is at risk from data leaks and identity theft online. Last month, for instance, India saw its biggest such data breach that put at risk 3.2 million debit cards. For India, the costs associated with data breaches are raising as well. Page No:57

4 3.3. Economic growth is increased by increasing the level of spending -Whereas physical cash leads to vulnerabilities of tax evasion, black money and fake currency, digital money is at risk from data leaks and identity theft online. Last month, for instance, India saw its biggest such data breach that put at risk 3.2 million debit cards. For India, the costs associated with data breaches are raising as well. 4. NEED FOR THE STUDY The present study is needed to examine the perception of Customers on Digital Money and its payments. The present study is needed to- 1. Know how Digital money system working. 2. Analyze customer satisfaction through Digital Payments. 3. Understand the benefits and problems of customers through Digital payments. 4. Determine the factors influencing mobile banking. 5. REVIEW OF LITERATURE This study critically reviews the literature that pertains to the developments in Indian Digital Payments. The literature review discusses technology acceptance framework for Digital money. They are as follows: Matthew NO Sadiku, Mahamadou Tembely, and Sarhan M Musa: Digital money is an idea whose time has come. It is the future of shopping. It has the potential to provide substantial economic and social benefits. It offers added convenience to consumers. It drastically reduces the cost and hassle of moving money around the world. However, the development of digital money has challenged the traditional monetary policy. The potential of digital money to move freely across international borders has alarmed central banks and other financial institutions. They are concerned that digital money could fuel money laundering and fraud and lead to a cashless society. Prof. Eduardo Henrique Diniz, Prof. Joao Porto de Albuquerque Prof. Adrian Kemmer Cernev in their article, Mobile Money and Payment: a literature review based on academic and practitioner-oriented publications ( ) the use of mobile technology has become widespread with astonishing speed all over the world, particularly among the poor. The more mobile phones go to the hands of people who formerly lacked access to financial services, the more the notions of mobile money, mobile payment and mobile banking become pervasive as a means of financial inclusion. Page No:58

5 Dorothy Sagayarani: cashless economy as it helps to fight against terrorism, corruption, money laundering but one biggest problem in the working of cashless economy in India is cybercrime and illegal access to primary data. Therefore it s important to strengthen Internet Security from protection against online fraud. Large number of population is still below literacy rate living in rural areas.for smooth implementation of cash less system in India, the following measures are recommended Government have to bring transparency and efficiency in epayment system, strategies used by government and RBI to encourage cashless transactions by licensing payment banks, promoting mobile wallets and withdrawing service charge on cards and digital payments. A financial literacy campaign should be conducted by government time to time to make population aware of benefits of electronic payments. Dr. Ravi CS: The Indian economy will digitalize in rural area through mobile based payments that are faster and cheaper to roll out. It is a matter of increasing awareness in rural area. Improved solutions in terms of UPIs, mobile wallets, and digital transactions with more secured features, ease of transactions and reduced cost of managing the digital payments could lead to more potential developments and supporting in improved conditions of digital payments processing in rural sectors. Mamta, Prof. Hariom Tyagi, Dr. Abhishek Shukla: in their The Study of Electronic Payment Systems, Electronic payments are financial transactions made without the use of paper documents such as cheques. Electronic payments include debit card, credit card, smart card, e-wallet, e-cash, electronic cheques etc. E-payment systems have received different acceptance level throughout the world; some methods of electronic payments are highly adopted while others are relatively low. This study aimed to identify the issues and challenges of electronic payment systems and offer some solutions to improve the e-payment system quality. 6. OBJECTIVES OF THE STUDY 1. To study the digital payment and cashless economy in Select area. 2. To know the problems and challenges of digital payment in India 3. To know the importance of digital payment after Demonetization as perceived by the people. 4. To assess the people trust and confidence in digital payment system after Demonetization. 5. To identify the factors of digital payment. Page No:59

6 6. To enlist the prospects and the road ahead of the study and offer appropriate suggestions for an effective implementation of digital payment. 7. HYPOTHESES OF THE STUDY Based on the above objectives followings hypotheses were formulated and tested in the present study: H0: There is no significant difference in the perception of customers on Digital Money and Digital Payments. Ha: There is a significant difference in the perception of customers on Digital Money and Digital Payments 8. RESEARCH METHODOLOGY This research is both quantitative and qualitative. This research is based on the data collected through structured questionnaire. The methodology used in the present study is as follows: 8.1. Sources of Data: The source of data has been grouped into two main categories i.e., primary and secondary data. The secondary data has been compiled from newspaper, journals, magazines, and web sites. The primary data is collected from select customers through structured questionnaire. These questions are designed on the basis of the operational definition of each variable which is discussed in the section of hypotheses formulation. The questionnaire is given to a sample of Type of Sample: The current study is a survey based research, using non-probability sampling technique. This makes them qualify to become the target sample. 9. SCOPE OF THE STUDY Scope of the study is covering maximum possible number of customers to understand their perception on Digital Payments through different factors. Two hundred customers are covered for this research to understand the opinion of customers as well as bank employees. This study is limited to the geographic area limited Suryapet District. This study broadly covers the factors, advantages, dangers and future prospects of Digital Money and its Payments. Page No:60

7 10. DATA ANALYSIS AND INTERPRETATION Gender - Wise Classification of Respondents: The purpose of this analysis is to know the gender of selected respondents. The relevant data is presented in table-1.1 Table-1: Gender - Wise Classification of Respondents Gender No. Of respondents Percentage MALE FEMALE TOTAL Interpretation: From the table - 1, it is observed that out of 300 selected respondents, 215 respondents (716%) are male, and 85 respondents (28.4%) are female. Finally, it is found that Male respondents are more than female respondents Age-wise Classification of Respondents: In order to analyze the perception of respondents categorized based on age. The purpose of this analysis is to know the age of respondents draw the inferences based on the age and the relevant data is presented in table-2 Table - 2: Age-wise Classification of Respondents Age/Years No. Of respondents Percentage TOTAL Interpretation: From the table - 2, it is observed that, out of 300 selected respondents, 42 respondents (14%) age between years, 150 offenders (50%) age is middle of years and 108 defendants (36%) are more than 40 years. Finally, it is concluded from the table majority respondent s age between 26 years to 40 years. Page No:61

8 10.3. Occupation-wise Classification of Respondents: In order to know the profession of Respondents this analysis is helpful. The relevant data collected through questionnaire is tabulated and presented in table-3 Table - 3: Occupation wise Classification of Respondents Category No. Of respondents Percentage of Responses Private employee Government employee Businessman Others TOTAL Interpretation: From the table -3, it is found that, out of 300 selected respondents, 89 respondents (29.6%) are Private employees, 86 respondents (28.6%) are Government employees,102 respondents (34%) are doing Business, and 23(7.8%) are others. Finally, it is concluded that Merchants are more than other respondents Cashless modes of payment benefiting you: Perception of select respondents are collected and presented in the table-4. This analysis is initiated to know that Digitalization is benefit to customers or not. Table - 4: Digitalization is benefit to Public Response No. of responses Percentage of responses Yes No TOTAL Interpretation: From the table-4, it is found that 210 respondents (84%) are said that Digitalization creates help to them, and 290 respondents have felt it is no use to them. Finally, from the table, it is concluded that Digitalization is useful to the public. Page No:62

9 10.5. What are the modes of payments you use: Perception of select respondents are collected and presented in the table-5. This analysis is to know that Digitalization payments mode of the customers. Table-5: Digital Payment Modes Response No. of Responses Percentage Aadhaar enabled payment system Unified payments interface Internet banking Mobile banking Others Total Interpretation: From the table-5, it is found that Payment mode of respondents. Out of 300 respondents, 82 respondents (27.3%) are Paying through Aadhaar based payment system, 56 respondents (18.6 %) are making payments through UPI, 82 respondents (30.6%) are using Net banking,81 respondents following the mode of Mobile Banking and 19 respondents (6.5%) are proceed through other payment systems. Finally it is concluded from the analysis more customers are following Net banking method Through Digitalization easy to make payments: Perception of select respondents are collected and presented in the table-5. This analysis is initiated to know that Digital payments are easy or not. Table - 6: Digitalization easy to make payments Response No. of responses Percentage of responses Yes No TOTAL Page No:63

10 Interpretation: From the table-6, it is found that 240 respondents (80%) are said that Digital payments are very easy and 60 respondents (20%) are felt that it is not easy for payments. Finally it is concluded that Digital payments are easy to follow Digitalization is reliable the transactions: Perception of select respondents are collected and presented in the table-7. This analysis is to know that Digital payments are reliable or not. Table - 7: Reliability of Digitalization Response No. of responses Percentage of responses Yes No TOTAL Interpretation: From the table-7, it is found that 252 respondents (84%) are said that Digital payments are very reliable and 48 respondents (16%) are feeling that it is not trustable. Finally it is concluded that Digital payments are reliable Digital Money can solve the problem of corruption: Through Digital money concept solves the problems of corruption, Opinions are collected from selected respondents and presented in table-8. Table -8: Government brings an end to black money with this decision Defendants Response No. of Respondents Percentage of Respondents Yes No Can t Say Total Interpretation: From the table 8, it is found that 185 respondents (61.6%) are agreed that government breaks corruption through Digital money, and, 67 respondents (22.3%) disagreed, and Page No:64

11 46 respondents (15.4%) are said that no idea about it. Finally, it is concluded from the table that maximum respondents are agreed government brings the end to corruption from this decision Uneducated population finds it difficult to access the digital payments Perception of select respondents are collected and presented in the table-9. This analysis is initiated to know that Digital payments are inconvenience to uneducated public or not. Table - 9: Digital Payments are inconvenience to uneducated Public Response No. of responses Percentage of responses Yes No TOTAL Interpretation: From the table-9, it is found that 260 respondents (86.6%) are said that Digital Payments are creates pain to them, and 40 respondents (13.4%) have felt no disturbance to them. Finally, from the table, it is concluded that Digital payments upset the public Do you think India can achieve a cashless society through Digital money: Perception of select respondents are collected and presented in the table-10. This analysis is initiated to know that Digital money makes India cashless society or not. Table - 10: Digital Money makes India Cashless society Response No. of responses Percentage of responses Yes No TOTAL Interpretation: From the table-10, it is found that 220 respondents (73.4%) are agreed and 80 respondents (266%) are not agreed Digital money and Digital Payments are made India Cashless County in future. Table-11 :Chi-Square Test Analysis of Customers Page No:65

12 Perception on Digital Money and Payemnts S.No Q.No. χ 2 value d.f P. Value Result H0 Rejected H0 Rejected H0 Rejected H0 Rejected H0 Rejected H0 Rejected H0 Rejected H0 Rejected H0 Rejected H0 Rejected From table-11, conclusions are drawn from the chi-square test analysis it is found that all 10 variables P-value is less than the alpha value of The null hypothesis is rejected. Hence, it is concluded that there is a significant difference in the perception of customers on the Digital Money and Digital Payments. 11. FINDINGS OF THE STUDY 1. It is found that between ages Customers are participating in Digital Payments, reaming Customers are following traditional payments. 2. It is found that selected sample Business peoples are actively participating. 3. From the study it is found that Customers are slowly making a habit of Digital payments. 4. It is found that Most of the customers area approached Net banking for Digital payments. 5. It is found that Digital payments are easy to educated people but not uneducated people. Illutrate peoples are getting fear about these transactions due to language problems and lack of awareness. 6. It is found that operations of accounts, conducting transactions through mobiles and to make online payments need training. Page No:66

13 7. Secondarily, the cost of transactions that are levied over the consumers is also a major concern. For example, over every debit card transaction, some retailers are charging the transaction cost from consumers and it is additional burden. To ensure that debit and credit cards are used prevalently, such transaction charges have to be evaded. 8. Mobile wallet companies has certainly made the transaction process much simpler to the customers, but the costs charged over switching the money from wallet to bank accounts are again a key concern. As the mobile wallet companies are charging anywhere around 1% to 4% for transactions to bank accounts, consumers are wary of using mobile wallets for business transactions 9. Finally it is found that Implementation of Digital money system will make India Cashless County in world and it solves the problems of Corruption. 12. SUGGESTIONS FOR THE STUDY 1. Create More Awareness among the Customers about electronic payments: Digital money and Digital payments is not aware of all the customers especially rural and village background people. It is suggested that the awareness creation among the existing customers and providing special benefits for using the mobile banking or net banking or pay tm will increase the non banking users. The action plan to the banker is that they need to visit various places by organizing seminars, conference, advertisements through print and electronic media etc, which is likely to increase their customer base and also activate intending users to use mobile banking services. 2. RBI and Banks should change the rules/limitation of using ATM cards; also decrease charging the transaction cost from consumers. 13. CONCLUSION OF THE STUDY Page No:67

14 Digital money is an idea whose time has come. It is the future of shopping. It has the potential to provide substantial economic and social benefits. It offers added convenience to consumers. It drastically reduces the cost and hassle of moving money around the world. However, the development of digital money has challenged the traditional monetary policy. The potential of digital money to move freely across international borders has alarmed central banks and other financial institutions. Government, RBI, and Banks should take initiation and create awareness among the public, it will make India Corruption free County and Cashless Society in World. 14. REFERENCES 1. Dennehy, D. & Sammon, D., Trends in mobile payments research: A literature review. Journal of Innovation Management, 3(1), pp Horowitz, M. J., Self-Identity Theory and Research Methods. Journal of Research Practice Volume 8, Issue 2, Article M S. Md. Shakir ali, md. Wasim akhtar, s. K. Safiuddin: Digital payments for rural india - challenges and Opportunities: International Journal of Management and Applied Science. 4. Dr. Ravi CS:: Digital payments system and rural India: A review of transaction to cashless economy: International Journal of Commerce and Management Research. 5. Dorothy Sagayarani: Digital Payments In India: IOSR Journal of Business and Management. 6. Piyush Kumar : Demonetization And Its Impact On Adoption Of Digital Payment: Opportunities, Issues And Challenges: Abhinav National Monthly Refereed Journal of Research in Commerce & Management 7. Matthew NO Sadiku, Mahamadou Tembely, Sarhan M Musa: Digital Money: Journal of Scientific and Engineering Research, 2016, 3(6): Page No:68