Visa and Innoviti Payment Solutions, India’s largest provider of payment solutions to offline enterprise merchants have partnered to drive a Proof of Concept (POC) for offline payments in India. The POC has been executed by Innoviti in Bengaluru in partnership with Yes Bank and Axis Bank.
A first in India, the offline payments technology will help improve reach of digital payments into small towns/ rural and remote areas and reduce dependency on internet for payments acceptance via chip-based Visa debit, credit, and prepaid cards even in places with low or no internet connectivity. This solution is aimed to contribute towards creating greater financial inclusion across rural, urban, and remote areas.
India faces a major challenge in terms of last-mile internet connectivity. Due to these infrastructural limitations and the resultant inconvenience, there are gaps in adoption of digital payments across smaller towns and rural pockets of the country. This is where the offline payments technology initiative is expected to bridge these gaps and help the merchants and consumers in these pockets benefit immensely by adopting digital payments, especially for micro-payments.
The offline payments technology is in-line with the government’s vision of enabling greater financial inclusion. With the deep penetration that debit cards have across India, offline payments using Visa cards is expected to facilitate transition of payments from cash to digital. Visa cardholders may soon get to request their bank for a fresh card that enables this solution.
The chip in this new Visa debit card will hold a stored value of a daily spend limit of INR 2,000 and have a per transaction limit of INR 200, which are the limits mandated by the RBI currently. This is akin to having a wallet with an amount preloaded into it. In the event of insufficient balance, the transaction will be declined, making this proposition conducive for cardholders as well as merchants. Merchants also stand to gain revenue from reduced friction and risk of payment failures. Visa’s solution is the first of its kind and equipped to enter the Indian market.
“The pandemic’s unprecedented impact has spurred significant movement in the digital payments ecosystem. With the RBI’s cognizance of low and no connectivity being major impediments to financial inclusion, offline payments have emerged as an innovative and low-cost solution, where internet connectivity and failed transactions are top concerns of consumers and merchants. Visa aims to change the way we pay, and this POC is going to do just that. We also aim to work with more issuers to scale this solution across banks and their cardholders,” said T.R. Ramachandran, Group Country Manager, India and South Asia, Visa.
“Lack of Internet connectivity have limited the democratization of digital payment acceptance in the country, as all existing payment technologies need real-time connectivity for authentication and authorization. Transaction failures arising from low quality connectivity impact consumer and merchant confidence, further impeding digital payment acceptance. Offline payments are a fast, reliable, and low-cost way of solving this problem that can change the way payments happen. We are excited about partnering with Visa, Yes Bank and Axis Bank in this pilot,” said Rajeev Agrawal, MD & CEO, Innoviti Payment Solutions, India.
Innoviti processes US$10 Billion of annualized offline merchant payment volume (~ 6% of India’s offline merchant volume, based on RBI data), turning payment transactions into business collaborations by creating software that brings merchants, banks, brands together to create new and unique ways of providing superior experiences to their common consumers.
Innoviti uses payment technology in unconventional ways to turn payment transactions into customer acquisition and retention tools for merchants, bank, and brands, by bringing them on to a common platform, and helping them deliver unique customer experiences, such as this one. Each business gets access to 3X loyal consumers at 1/3rd the cost, accelerating sales with unmatched efficiencies.
Innoviti had raised a Series C in 2020 to further its differentiated strategy of servicing the retail market through category and segment specific products.
