Spotlight India: Speaking the new language and culture of money

The revolution in its financial services sector has led to India speaking the new language of money and in this Spotlight India series, WARC India Editor Biprorshee Das highlights the technology and innovations that are driving the radical changes in the financial infrastructure and consumer behaviours.

While brainstorming for this edition of Spotlight India, I particularly liked this one suggestion by WARC’s Asia Editor Rica Facundo – “Speaking a new common language of money”. I thought it perfectly captured what we wanted to explore here.

Consider the last few years and you will notice how the financial space in India has witnessed an incredible transformation. You could be on either side of the fence when it comes to the Great Demonetisation of 2016; what you cannot deny is that it was a singular event that redefined how Indians look at money. It didn’t matter if one belonged to the affluent part of the population or not – if one is an urban resident or a rural citizen, a “common language of money” was in the making.

In one of our previous editions in 2019, we looked at India’s digital payment future. The conversation then was about digital transformation and cashless transactions. This time around, we look at how things are evolving rapidly, how behavioural changes have set in and how the Indian is more aware and concerned about his/her financial health than ever before. The infrastructure, reforms and the constant innovations are only the enablers.

Digital transactions are the order of the day and the segment is driving the fintech space in India that is arguably among the fastest growing in the world. A report by digital payments and financial services company PhonePe and Boston Consulting Group states that India’s digital payments market will touch the US$10 trillion mark by 2026. I know I can step out of my home without my wallet and not be inconvenienced one bit.

But there’s a lot more to the story than just cashless transactions. With changing attitudes and constant developments, newer concepts are being devised. Credit is more accessible than ever, there are novel ways for an Indian to save, invest and even spend disposable income; financial education, awareness and inclusion are on the rise. And when it is about brands and marketing in the space, there is a healthy and constant exchange of learnings between the brand and the consumer that is further fuelling innovation. These only make conversations and a Spotlight on the subject more interesting.

The digital infrastructure enabling culture change

If only you could have a penny for each time the word “digital” is used in a conversation on the developing financial landscape in India. As mentioned, it is the digital infrastructure that has led to a radical shift in the thinking behind money.

Puneet Avasthi, senior executive director, South Asia, of Kantar’s insights division, contributed a detailed knowledge paper on how digital has facilitated a fintech revolution in the country, with India beyond the metros, often referred to as Bharat in marketing parlance these days, has embraced the digital way.

In Avasthi’s words, “The digital revolution has created multiple wavefronts of positive change in the financial system of the country and strong impetus for social betterment and inclusion for all. Marketers must leverage this digital transformation wave to engage and connect with their consumers.”

Pooja Rawat, EVP of strategy at Lowe Lintas Mumbai, shared, “Effectively utilising data that comes with the digital age will help with seeing valuable customer insights, their behaviours, motivations and interests. This, in turn, will enable financial brands to offer personalised products, relevant insights to manage money better, speak their language and even hang out with them.”

Credit for all

A major development in recent years has been the easy access to credit. Once the domain of banks, neobanks (a concept India is embracing) and similar players in the space are an increasingly accepted concept. I spoke to Hitarth Saini, head of marketing at Freo, and how the Indian credit-led neobank has demonstrated that armed with just a mobile phone and access to data, you can do things with money previously unimagined.

Talking about Freo’s offerings and how it is being an extension of a bank in the digital space, Saini said, “Our apps have been downloaded more than 20 million times and are available in multiple vernacular languages and we are India’s first full-stack consumer neobank with live products across credit lines, personal loans, co-branded credit cards, gold loans, savings account, pay later services and financial utilities.”

Traditionally, there have been negative connotations around personal credit for Indians, who are often advised by senior family members against credit card use and personal loans. “Not good if you want to be financially disciplined,” we are told. Then again, car and housing loans are perfectly normal. For this edition, I also interviewed Akash Dahiya, co-founder of SanKash, one of the players in the emerging Buy Now Pay Later space. The company allows the Indian traveller to take vacations and conveniently pay for them later. Again, a concept that is novel in India.

Dahiya explained how loans in India, as long as they are driven by a purpose, are normal and encouraged. But today’s Indian is more than happy to take a loan to travel, buy an otherwise unaffordable smartphone and even to meet petty expenses. That’s one of the radical changes we are witnessing and that is the change players like Freo and SanKash are driving.

The changing currency and stakeholders of money

Talking about shifts in behaviour in the financial world, it is important to note the changes happening at the fundamental levels, something as basic as the Indian family.

Shaziya Khan, national planning director of Wunderman Thompson, does so in her article. Referencing an inhouse study, Khan elaborated on how changing attitudes within the Indian household are presenting opportunities for financial brands, saying, “Finance in the household is no longer a solo responsibility. Multiple members of the household are participating in financial decision making. This notion of joint responsibility in financial matters is a top shift in attitudes among both men and women, young and middle-aged consumers across income strata and regions.”

Fintech is influencing and shaping new behaviour. Ajeeta Bharadwaj, chief strategy officer of Wondrlab aptly titled her paper “How fintech solutions are helping India to pursue its financial aspirations”.

She makes an important point saying, “Money has become the currency for better lifestyles, the latest gadgets, travel and experiences. Which means that, wherever you are on the income pyramid, money is still under pressure to fulfil growing aspirations.”

Risks remain

One cannot afford to be blind to the other side of the coin, of course. Changes must be responsibly handled, after all, and not everyone will behave in a mature way, especially not when it is about money. Take, for instance, financial fraud. It isn’t a new menace but it is taking new shape too and we would do well not to ignore how cyber fraud is on the rise.

PwC calls “platform fraud” or fraud associated with social media, e-commerce and such digital platforms, the new frontier of economic crime. According to the second edition of PwC’s Global Economic Crime and Fraud Survey 2022: India Insights, such crimes have become more common since the pandemic with remote working, e-commerce growth, delivery applications and contactless payments.

Mehak Jaini, national strategy head of 22feet Tribal Worldwide, shared how financial fraud is a major deterrent to financial inclusion in India.

“Financial frauds or scams have a huge impact on the perceived sense of security and trust, and could be major deterrents to the uninitiated or unbanked. Frauds have power because bad news spreads like wildfire. There is an inherent negativity bias in all of us – the natural human tendency to focus on the bad side rather than the good,” she said.

The Indian financial space is undoubtedly in the middle of a wave of radical change. Things are evolving rapidly and they are worth boasting about. Things will change more and hopefully, India will still be boasting about them. It’s no longer 1964 after all and almost no one wants to sing, “I don’t care too much for money”. Not in India for sure. Sorry, Beatles!