SMEs must have trusted online payment partner: Rahul Chiddarwar

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Saurabh Gupta | 29 May, 2013
Today when Indian e-commerce has grown from $2.5 billion in 2009 to $14 billion, most of the small and medium enterprises (SMEs) overlook the importance of the authentic service provider of online payment gateways. In a exclusive interview to SME Times, Head - e-Payments, TimesofMoney, Rahul Chiddarwar said that it is very important to have a trusted online payment partner when it comes to financial transactions, especially for SMEs, where the working capital is of great importance.

Excerpts of the interview...

The current recession has had an impact in the global growth, how about growth of online shopping especially in India in the last few years?
Rahul Chiddarwar: Over the last couple of years, India has shown that it is a different animal vis-Ã -vis global trends in various aspects. With a large number of e-commerce players and investors in the market today, the industry shows great potential. Indian e-commerce has grown from $2.5 billion in 2009 to $14 billion today (Source: IAMAI). The country has evidently bucked the trend till now and in favorable conditions, should continue to do so.

The trend in online shopping is increasing fast but still has a potential to grow exponentially in the times to come. In terms of growth, how do you see the future of online shopping in India?
Rahul Chiddarwar: The e-commerce market is predicted to touch $265 billion in 2025 in a good scenario (Source: 'E-commerce: A boon for the current economic downturn') and is witnessing a lot of innovation. With merchant portals available on mobile phones and apps, as well as the widening of payment options, the dynamics of the industry are poised for change. 5 years back, who would have thought Indians would buy appliances, furniture and insurance online? The convenience and ease of the online browse-to-buy navigation is catching on. There is a slow but steady change in the Indian mindset towards purchasing goods and services online.

There is a steady increase in the number of e-commerce customers from Tier 2 and Tier 3 cities, as online shopping opens up their access to brands, products and services which may not be available locally. The scope of exploring options online is continuing to grow among consumers, with merchants making the process simpler and more seamless and experiential. E-tailers are also expanding their offerings with increasing product verticals they cater to. Providing more categories under the same roof widens reach as well as consequent traffic and business for merchants. So if a merchant was selling only books online, he is expanding to gadgets, apparel, music, accessories and much more.

Though internet users are increasing but still people are not aware about e-retail and the product they sell. What is your say on this?
Rahul Chiddarwar: I would consider that only partly true. The low awareness of e-tailing can be attributed to factors like the overall low Internet penetration in India and an inherent apprehension about online purchases; which is a predominant reason why cash on delivery (COD) is still a widely used way of paying. But today, apart from shopping and travel, consumers can even manage and pay utility bills and taxes to the government online. The fact that online transactions are safe should be reinforced, not just in the merchant community but in consumers as well.
Today, it is commonplace for consumers to browse, read and compare online, for anything from technology to deals to insurance. However, this does not always translate into online transactions. In spite of an increasing awareness of online retail, the last mile gap is prevalent in a market like India where product touch-and-feel is still very important for a buyer. People prefer taking time out to go to a brick-and-mortar store, especially for physical products, where it is important for him to see and check it before buying. One of the few sectors which have seen significant traction online is of travel, which constitutes 75% of the e-commerce market in India.

Tell us more about your brand DirecPay.
Rahul Chiddarwar: DirecPay is a Payment Gateway service from TimesofMoney. It enables merchants to accept payments from customers through all access channels. It is equipped to accept payments from over 130 pay-modes which include virtually all credit cards, debit cards, bank accounts and cash cards. With DirecPay, merchants have the advantage of a wide coverage of payment modes, a robust transaction platform, multiple access points like Web, IVR and Mobile and value added features like stored card, multi bank EMI, mobile checkout and on-demand analytics.

How does DirecPay work? What kind of software is required for this? Do you have technical support team to assist your small clients?
Rahul Chiddarwar: DirecPay is a simple bank-neutral payment gateway service. The merchant has to just include a piece of code in his checkout page and he gets access to all the payment options which DirecPay supports .There is a standard API available which needs to be integrated by the merchant. There also is a dedicated merchant support team to assist in case of any queries.

How much does this cost? What is the annual maintenance cost of your service?
Rahul Chiddarwar: There are two cost elements apart from the transaction fees; one is the one-time setup fee and the second is the annual maintenance charges. These costs vary as per the plan chosen by the merchant.

Many of the small and medium enterprises (SMEs) overlook the importance of the authentic service provider of online payment gateways. How is DirecPay more useful for SMEs then any other gateway?
Rahul Chiddarwar: We understand that it is very important to have a trusted payment partner when it comes to financial transactions, especially for SMEs, where the working capital is of great importance. SMEs constitute close to 30% of DirecPayâs merchants. We provide focused attention to merchants for their primary need of competitive fees, along with dedicated relationship managers to service them and offer customized solutions.

We pride ourselves on having gone beyond just providing a payment gateway. At DirecPay we help merchants with website creation, optimizing their searches, helping them reach out to relevant customers online, cross-promote them with bank partners and advise them on site enhancements to increase their transactions. DirecPay also aids merchants in winning back their lost customers by providing intelligent information on a transactional level, via real-time alerts and analytics with DirecPay Insights. With our experience enabling DirecPay Insights, we have helped merchants win back close to 40% of their abandoned transactions.

When it comes to payment options, they vary for rural and urban customers, customers in the metros are provided with an option of cash on delivery while advance payment is required for non-metro customers or rural area customers. Does DirecPay have something for these non-metro consumers?
Rahul Chiddarwar: As far as non-metro customers are concerned, there is a preference from them to use their bank accounts or debit cards as compared to credit cards, for which the penetration is less in non-metro areas. Additionally, DirecPay also offers the IVR facility which helps non-metro customers, who do not have access to the Internet, to make payments using a phone.

Malware, virus, bots and loggers are some major risks for online financial transactions. How can SMEs overcome these challenges?
Rahul Chiddarwar: At DirecPay we ensure that the payment gateway offering to an ecommerce solution is secure and can withstand any malicious activity. Whether it is a merchant or a buyer, the security of his online transaction is of foremost importance to us. We aim to provide completely safe transactions through DirecPay Shield, a robust risk management module that helps eliminate any suspicious activity and fraudulent transactions. We inspect transactions through different levels of checks in the risk management module. With our highly proven track record of successful transactions and minimal fraud due to these stringent practices, we pride on having the best industry record for zero chargebacks for the last 3 years.

* (Rahul Chiddarwar currently heads the Payment Gateway Business, DirecPay at TimesofMoney. With a total experience of more than 13 years across different organizations in roles of business development and leadership, he started his career with Hindustan Unilever in their Personal Care division. He managed Sales and Marketing for brands like Sunsilk, Ponds, Dove, Axe, Clinic, Lux, Close-up, among others.)