Payment transactions in India ahead of China based on 2020 data, says Mehta
The digital transformation of India is only just accelerating, but the internet economy could grow 10x in 10 years from here on to get to more than US$800 billion, resulting in many large businesses accreting significant shareholder wealth, a senior industry official said on 30 Mar 2022.
“The nature and shape of the Indian economy and financial markets will be very different in 2030 than they are today,” said Siddharth Mehta, founder and CIO of Bay Capital, an India-focused investment manager with offices in Mumbai, London and Mauritius.
He said, “Just to put things in perspective, India has the highest volume of real time payment transactions with over 25 billion transactions in 2020. China was next at about 16 billion transactions in 2020!”
Mehta is very excited about investing in the Indian market rather than any other emerging and developed one. Because India has seen a tremendous increase in the overall penetration of the internet owing to strong growth in low-cost smartphones, a significant reduction in data prices, the creation of an ecosystem of products and services driven by the government’s digital initiatives, and the development of low cost, robust payment systems.
He underlined, “Today, there are over 758 million internet users in India with ~700 million smartphones. In fact, the average data consumption per user per month in India is the highest in the world at ~13.5 GB and Indians spend almost 6.5 hours per day online.”
Over the course of the last decade, India has laid down the digital infrastructure pipelines – so much so, that today Digital activity has become part of daily lives of over half the country and has enabled India to circumvent the challenges posed by its poor physical infrastructure, he said.
“Be it bank accounts, KYCs, daily transactions, accessing government services, education services, and even COVID vaccinations, all of this is now digitally led in India.”
In such a scenario, it can be said that India is now on the path to becoming the largest digitize business hub in less than 20 years, said Mehta, the former IL&FS director.
COVID-19 also plays an essential role to help India in rolling out the digitalization aspects. It has acted as an accelerator for the adoption of the digital economy.
In every sector and in every business aspect, digital activity has become extremely important and relevant as this was the only way for consumers to access products and services and for businesses to operate.
Focusing on investment opportunities in India’s internet and digital ecosystem as a result of digital transformation, Mehta said, “Yes, indeed, there are many outstanding businesses that have created tremendous scale and are seeing their paths to profitability getting accelerated.
“We are particularly interested in those businesses that are solving uniquely Indian problems in uniquely Indian ways and those that are targeting the next billion internet users in India.” fiinews.com
