One of the stumbling blocks for e-commerce in India is the lack of penetration of credit/debit cards and the fear of using them online to make purchases.
Payin2 is a new service that hopes to make it easier for SME’s and startups to charge for their products and provide them with a ready to use electronic distribution and cash collection service. The mode of operation is offline, which Payin2 does by its 30,000 ‘recharge points’ operated by its parent company Paytronic Network. Paytronic is one of the leading electronic distributors of prepaid mobile vouchers and extending this for of payment / recharging serves as a natural evolution of their ‘recharge points’ network.
Here’s how the service works:
Once you register with their site, you can select a few keywords that are uniquely associated with your service. When a consumer needs to make a payment to you, they visit any of Payin2′s recharge points and make a cash payment. The merchant sends a SMS to the Paytronic number (known only to the merchant), which is handled by the Payin2 backend server. Your code leverages the Payin2 API to verify the payment and recharge the customer’s account. Currently, Payin2 charges a 10% of the transaction amount as their service fees.
I think Payin2 is a great extension of their existing distribution network and could serve as a significant channel to reach out to those consumers who dont have access to cash cards and or mobile payments.
If I am not wrong, it works pretty much as the ItzCash cards and some other prepaid cards. There was some other company with mobile based solution too.
Anyways, I doubt if it provides a breaking solution to any real problem. Most businesses offer direct bank deposits and online transfer.
What I would actually like to see is a service that recharges my Paypal account – It would accept cash from me and credit equivalent dollars into my paypal account.
Another concern is the steep 10% service fees. Who wants to pay Rs. 500/- as “service charges” for a product retailing at Rs. 5000/-. This is more evil than “service tax” levied by the government. Also, would they be charging both merchant as well as customer? Would they charge both 10% or 5%?
This seems more like a solution in search of problem and money to gulp!
Hi Rohan, this is Prithvi from Payin2.com. We are also trying to create a mode of payment through Payin2 service. In that sense its similar to other prepaid cards. But operationally its very different – we dont ask the customers to put a balance with us, there is no concept of leakage or float here. Whenever a customer wants to make a payment, he just approaches one of our shops and pays in cash.
Our service is targeted at small companies and startups who dont have the ability/trust to start their own distribution/cash collection service. How many people will be comfortable doing online payment for a small unknown startup? We act as a kind of escrow for these players.
Also its not just cash collection but also electronic distribution service. For eg consider a software company which wants to sell its licensed software. It could distribute registration codes through our network and allow for free downloading from its website.
What you suggested about Paypal service is also possible through this service (of course we need to look at the RBI regulations). The point is ours is a generic service and the possibilities are endless.
If you look at our website, we have not yet finalised the service fee and are still trying to get feedback before we finalise it. Thing to be kept in mind is that it has to be attractive to all the stakeholders – merchants (who accept payments), businesses and Payin2.
This mode is of operation will be future. I am associated with a retail financing company where the customers are scattered in deep rural, I have want collection point of this type where the customers can approach this points and make the EMI payment every month. With some modifications this, can be made appropriate for my kind of working. Who is the concern who can guide me thorugh the product in details.