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India’s currency crisis a boon for online delivery firms & restaurants


India’s currency crisis is proving to be a boon for online delivery firms, restaurants and taxi aggregators. These on-demand service providers are making the most of the cash crunch caused by the currency recall, employing a few timely business hacks to emerge out of a looming slowdown.

Soon after the government on November 8 invalidated about 86% of the banknotes in circulation, forcing millions of people to join long queues outside banks and ATMs, Ola launched its version of mobile ATMs. India’s largest taxi-hailing service partnered with Punjab National Bank and Yes Bank in 10 cities to ferry the banks’ staffers to various pockets to disburse cash to ac count holders. The initiative, dressed as a social good, helped Ola gain greater visibility.

“Since demonetisation, we saw a 15-fold rise in recharges on Ola Money (Ola’s digital wallet that can be used to pay for taxi rides and other services),” said Raghuvesh Sarup, head of categories at Ola. “It has found a 300% increase even outside the cab business.”

For food delivery firm Swiggy, which took to delivering food to the people queued outside banks and ATMs, the use of its digital wallet increased by about 2.5 times in November. “Almost 50% of our users who ordered in during this period had never paid online before,” co-founder Nandan Reddy said.

Online purchases of daily essentials and food items increased as people struggled to pay in paper money for small and routine requirements such as vegetables and groceries. Plastic money and digital wallets have made it more convenient to buy online from stores such as BigBasket.

Over the past month, prepaid instruments and online payments ha ve accounted for about 80% of all customer payments made to BigBasket. The country’s largest online grocery store expects sequential monthly growth to double in December, from an average 21%.

“Our fruits and vegetables business has seen a tremendous increase. From 70% of our orders, it has gone up to 90%, where these orders have at least one fruit or vegetable order as corner stores don’t accept (credit or debit) cards,” chief executive Hari Menon said.

For hyper-local grocery delivery firms, revenues surged 30-40% last month, show data from Red Seer Consulting.

Several firms are also extending credit to customers to allow them to tide over the currency crisis.

Online restaurant Faasos launched a 15-day credit scheme to customers who have been using the platform for the past year. “We don’t plan to take away the (credit) service from customers who are paying up on time, as long as we don’t have any financial liability,” said Jaydeep Barman, CEO of Faasos.

Ola launched a similar service.”Through Ola Credit, we offered credit to some of our top customers, especially on the corporate side.Without them even having to recharge, we gave them seven extra days of credit,” said Sarup.

Source: Economic times

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