Citibank India is trying to further exploreIndian card market opportunities by creating a Square-like solutionfor the local merchants.
The Reserve Bank of India-approved,PCI-compliant system will let merchants using an Android-basedhandset, dongle and mobile app accept payments from the country’s320 million cardholders.
Several retailers, including Flipkart, Shoppers Stop, BajajAllianz, Vodafone and BookMyShowm have signed up to the technology,which Citi says can be simply integrated into their back-endsystems and customised to meet specific needs.
India is a country where small merchants dominate the landscapeand large retailers account for less than 10% of total retail salesin the country. Cheap mobile card acceptance products like Squarehave a lot of potential in India where mobile penetration andmobile Internet access are quickly growing.
And numerous Square-like solutions are being offered in othercountries both developed and developing. For example, ChinaUnionPay also has its own similar product in China.
But the solutions still have a long way to go. Costs and telecominfrastructure are major reasons why many small merchants have yetto accept cards. But there are other important factors such as taxevasion, training, services, or just habits which are not easytasks to handle either.