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CURRENCY CRISIS

Demonetisation badly hits e-tailing, online cabs

e-tailing-reuters [File] E-tailing transactions were declined by 15-20 per cent within days of demonetisation | Reuters

E-tailing, one of the hottest sectors for start-ups, has been negatively impacted by demonetisation, according to a report by Redseer Consulting, a consumer internet advisory firm. E-tailing transactions were declined by 15-20 per cent within days of Union government deciding to scrap the high-value currency notes. 

Similar was the case for online cab aggregators. A decline of 3-5 per cent was seen among major players owing to lack of customer confidence in using their wallets.

However, demonetisation had a positive impact on hyperlocal grocery and food-tech sectors. Food-tech companies saw a significant increase in their online payments with some experience close to 90 per cent increase in transactions. Players have introduced cashback and 'pay later' offers that influenced more customers to go online.

Hyperlocal saw a sharp increase pushing companies to hire more staff. Players are expecting much higher volumes over the next 2-3 months with more customers switching to online payments than CoD.

“Hyperlocal grocery and food-tech are clear winners as customers don’t have any ready-cash to do the daily offline purchases; but for e-tailing and online cabs, the month of November has been a hiccup in their growth stories—both dependent heavily on cash transactions. However, the positive side of this is the number of customers are becoming comfortable with cashless transactions; over the longer run, this will enhance the pre-paid model for these companies”, said Anil Kumar, CEO of Red Seer Consulting.

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Topics : #Demonetization

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