Travel is booming, airports are overcrowded, railroads are congested. Cross-border travel is recovering rapidly.
Students are leaving the virtual classroom and returning directly to school, while international students are stepping into dormitories and accounting offices.
Daniel Marovitz, senior vice president of Booking.com, Arnab Kumar, founder of Leap Finance, and Lij Dutta, co-founder of Cash-Free Payments, told Karen Webster of PYMNTS that consumers are physically said India is putting the spotlight on all payment frictions as it moves across borders.
As e-commerce grows across all types of industries in the country, businesses face the challenge of getting the right mix of payments to increase conversions and capture more consumer spend. Simply put, the most “popular” payment methods are not the ones consumers prefer to use when leaving their home country.
Travel offers a microcosm of challenges and opportunities. As Marovitz said, India was the third largest source of international travel pre-COVID.
“Travel is a basic instinct,” he said. “And India is waking up to it.” As a result, online bookings have exploded, and this surge has brought its own complications. There has been a big difference in how travel is planned and paid for in the last few years, and the process usually involved travel agents.
Today, consumers primarily book travel online or through travel apps. Along the way, these consumers want their payment experience to be consistent when navigating restaurant and car rental destinations. Much of the economic friction that still occurs in international travel revolves around completing transactions and dealing with cancellations and refunds.
Marovitz said he calls it “connected travel” because travel can be simplified into a series of tabs within the app. The process itself is flexible enough that it’s easier than ever to change your travel plans in a streamlined and intuitive way across currencies, time zones and exchange rates.
Datta also said that localized payment methods could solve some of FX’s pain points and save on cross-border fees.
Demonetization sets the stage
According to Marovitz, the stage is set for modern payment methods to take root in India. This has encouraged digital payments and card usage, but given the fact that he only has 1 billion debit cards and about 60 million credit cards in the country, the market has become a bit polarized. I’m here.
The RuPay card payment network has become very important to consumers, and its domestic dominance has spread internationally. Overall, merchants who only look at the most popular payment methods miss out on new revenue-generating activities.
Related: Low-code ‘Lego’ helps Indian businesses scale cross-border payments
As Datta of Cashfree noted, cards may have been the most popular online payment method a few years ago, but in recent years UPI has emerged as the preferred real-time payment option, with debit and credit cards Generates more trading volume. Combined.
“This is probably the most efficient payment,” he said, noting streamlined, instant and real-time bank-to-bank transfers. This speed will be attractive to companies operating outside India and wishing to enter the market, as well as companies based in India wishing to serve Indian consumers as they go abroad. it can be something significant.
India’s central bank has set up a liberalized remittance scheme that allows individuals to send up to $250,000 in a given year for education, travel or gift funds, a move to help improve money mobility. There were at least some
Providers face the challenge of improving the speed of money transfers and coordinating the flow of those funds, he said. These improvements can be achieved through the low-code or no-code solutions and application programming interfaces (APIs) offered by Cashfree, Datta said.
“The value proposition we are offering is enabling local payment methods,” he said. Leverage advanced technology to create documentation such as offer letters and passports to accompany payments, and view spend tallies against the $250,000 limit.
Otherwise, payment aggregators are becoming increasingly important as businesses need to connect and integrate with banks for each market, he said. Enabling local payment acceptance for cross-border transactions could be a difficult hurdle, he added.
Aggregators such as Cashfree can help significantly reduce transaction costs by saving 60% on FX rates and splitting travel-related payments to ensure the right amount goes to the right bank account. .
The number of Indian students traveling abroad will grow by 44% year-on-year in 2021. The country is poised to overtake China as the country that sends the most international students to pursue their studies in different parts of the world (with India currently in second place). ).
As Kumar said, “Indian students are ambitious for global careers and global education.” Many Indian families struggle to access various financial instruments in these new countries. Paying tuition fees is difficult given the fact that
See also Cashfree Team and EasyTransfer Facilitate International Money Transfers to Indian Universities
Platforms such as Leap help consumers start new financial journeys in these host countries while underwriting loans and meeting the documentation and regulatory requirements (visa) for borrowers to initially transfer their capital out of India. etc.).
The company also issues credit cards for students that can be used for a variety of payments, allowing you to build credit from day one in your new destination. Payments can also be made directly to the institution rather than being credited to the student’s account and paid to the school at a later date.
“Being able to take out loans in a variety of destination currencies can significantly lower the cost of capital.”
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