Growth Opportunities Sparked for the Indian Point-of-Sale Terminals Market as Government Expands Banked Population
Healthcare, retail and entertainment will generate high revenues for PoS terminal vendors, finds Frost & Sullivan's Electronics and Security Team
MUMBAI, India, Sept. 7, 2016 /PRNewswire/ -- India is currently the 13th largest plastic economy in the world, with a high potential to move up the ranking as more merchants install Point-of-Sales (PoS) systems. So far, only 35% of the country's population has bank accounts but with the Government implementing programs to provide free bank accounts with ATM/credit/debit cards, the stage is set for the explosive growth of opportunities in payment infrastructure.
New analysis from Frost & Sullivan, Analysis of the Indian Point-of-Sale (PoS) Terminals Market finds that the market earned revenues of more than INR 2.15 billion in 2015 and estimates this to reach INR 3.86 billion in 2020. Wireless PoS terminals are growing rapidly and will outstrip wired terminals by 2022, owing to their ease of use and lower complexity.
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The Indian Point-of-Sale (PoS) Terminals Market is the new analysis which is part of the Electronic Devices Growth Partnership Service program.
Even though there is a surge in the uptake of payment terminals in India, the penetration and usage is far below compared to those of Western countries as:
- A huge gap exists in the ratio of number of cards issued against the number of PoS terminals installations, mostly due to the lack of bank accounts and card holders
- Small- and medium-sized enterprises are hesitant to adopt PoS terminals as they engage in heavy cash transactions
"Government programs to convert the unbanked population to banked need to be supported by nationalized and private banks' efforts to expand their presence across all tiers of cities," said Frost & Sullivan Electronics and Security Research Analyst Aiswarya KG. "Additionally, spreading awareness regarding the security of bank accounts is critical to change customer sentiment and promote card-based transactions over cash transactions."
Currently, PoS terminal adoption is highest in Tier-1 cities, with Tier-2 and Tier-3 cities gradually catching up. Projects such as Micro ATMs and the Jan Dhan scheme are boosting investment opportunities in PoS terminals in the rural areas. Besides, the recent roll out of chip-plus-pin authentication offers double security benefits for consumers making card transactions.
However, the accelerated growth of cashless transactions using cards is expected to take a hit from the escalating popularity of e-commerce. Similarly, card-on-delivery is gaining traction but online transactions have garnered the majority share in the digital transactions recorded so far.
"Healthcare, retail and entertainment sectors will generate considerable revenues in this market, as customers prefer not to carry huge sums of cash to these points of sale," noted Aiswarya. "Significantly, more than 80% of retail centres still do not have a PoS terminal. This translates to substantial potential for the switch to plastic currency, with banks, card issuers and retail showrooms offering value-added services for card-based transactions."
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Analysis of the Indian Point-of-Sale (PoS) Terminals Market
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