COVID-19 update | Kirana stores witness 96% rise in AePS transaction volumes during lockdown: PayNearby report

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India’s leading hyperlocal fintech start-up PayNearby on January 12 said that during the COVID-19 lockdown there was a rise of 96 percent and 27 percent in volume and value, respectively in AePS withdrawals (Aadhaar ATMs) at Kirana outlets across the country.

The growth was a direct result of the government's various relief funds disbursed to support citizens during the pandemic and primarily led by rural and semi-urban areas, which witnessed a growth of 61 percent and 60 percent, respectively in transaction volumes, says PayNearby's Pan-India report titled ‘Retail-O-Nomics’. It was prepared based on the transactions registered across more than a million retail touchpoints across the country.

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The overall gross transactional value (GTV) of digital transactions at retail outlets by August end saw a revival and growth by more than 17 percent, while transactional volumes dipped by about 7 percent. This change reflected the revival of money transfer, travel and utility payment businesses, and signified a return of larger ticket size transactions, the report added.

With India witnessing a mass movement of the migrant community from metros, Domestic Money Transfer (DMT) saw a sharp decline of more than 85 percent in the first two months but started picking up again by late July. The remittance business saw a V-shaped recovery and registered a growth of 106 percent and 100 percent in value and volume, respectively during the lockdown.

That apart, people avoided stepping out of their homes to pay their bills during the lockdown, on account of which utility bill payments at kirana stores witnessed a clear drop of 23 percent in GTV. However, in the unlock phase, these transactions picked up by almost 67 percent in volumes and 76 percent in value.

Similarly, in the travel bookings -- including bus, railways and air, kirana stores witnessed a dip of over 75 percent during the lockdown phase, while it bounced back and registered a steep growth of over 100 percent in the unlock phase.

The PayNearby report adds that mobile recharges witnessed a rise of 39 percent and 34 percent in value and volume, respectively during the lockdown phase.

Among other details, the report stated that 48 percent of the total transactions were registered at Kirana stores between 7 am to 2 pm, while 52 percent of the transactions were registered during the non-banking time zone, underlining the crucial role these kirana outlets played during the lockdown.

"India was future-proofed by NPCI and Nandan with AEPS. The fact that during the lockdown, 115 Mn debit cards were out of the system due to non-compliance with CHIP & PIN guidelines, but AEPS came as a BCP for ATM, helping people access the essential money remitted by Government of India. The same is reflected in our data, where the disbursal of Direct Benefit Transfer (DBT) wouldn’t have been possible without AEPS withdrawal facility in the region," PayNearby MD and CEO Anand Kumar Bajaj said.

He added, "We witnessed a sharp growth in retailers who wanted to join the program, and added more than 3 lakh registered retailers during this time."

Apart from this, he mentioned the rise in Micro ATM, mPoS and other digital payment transactions are indicative of the huge latent demand that exists for easy to use digital payment technology across the country, especially in Tier 2 and beyond regions. The firm aims to empower its retailers and consumers by blending easily to use technology with last-mile connectivity to bridge the digital divide and create an equal Digital India.