CHAPTER-I

INTRODUCTION OF THE STUDY

1
 CHAPTER-I

INTRODUCTION OF THE STUDY

1.1. Introduction

Digital payment is a way of payment which is made through digital modes.

In digital payments, payer and payee both use digital modes to send and receive
money. It is also called electronic payment. No hard cash (currency notes) is
involved in the digital payments. All the transactions in digital payments are
completed. through online. It is an instant and convenient way to make
payments.

Digital payment includes providing financial services through fixed and

wireless computer networks to economic institutes, people, and families.
Challenges of payment systems in different countries have led to necessity of
existence of effective systems for coherent payment management considering
suitable security structures and providing standards, rules and regulations and
performing the required supervision for good implementation in the used
payment model.

Currently available digital payment systems include Banking cards, Digital

wallets, Unified Payment Interface (UPI), Unstructured Supplementary Service
Data (USSD), Immediate Payment Service (IMPS), Real Time Gross Settlement
(RTGS), National Electronic Fund Transfer (NEFT), Aadhar Enabled Payment
System (AEPS) and Mobile banking. With recent advances technologies, digital
payments is having an impact on our daily lives and beginning to offer
interesting and advantageous new services.

According to RBI Bulletin cashless transaction in India increasing day by

day. The statistics in report shows that in November 2016 and December 2016
the total value transaction done using E-Wallet was 50.74 Billion and 97.70
Billion respectively and in January 2017 it is increased up to 108.69 Billion.
Cash may not be a king anymore, the adoption of digital payments is picking up
at an extreme pace, everyone from vegetable vendor to chai-wala is adopting the
digital payment system to move away from the cash crunch.

New technologies, players and consumer expectations are changing the

payments marketplace more than ever. The opportunity of the new digital
payment ecosystem comes with risks. From cyber security and privacy to the
impact of legacy technology and new competitors, it is far from clear sailing for
organizations wanting to be a player in the future payments marketplace. In
wake of the government initiatives towards transformation towards digital
economy, and many private companies, payment bank licenses issued by RBI,
witness the transformation. Faceless, Paperless, Cashless‖ is one of professed
role of Digital India. The emphasis is on the different methods of digital payments
by considering the challenges and providing solutions according to the existing
scenario.
1.2. Statement of the Problem

Digital Payment is a financial exchange that takes place online between

buyers and sellers. The content of this exchange is usually some form of digital
financial instrument (such as encrypted credit card numbers, digital cheque or
digital cash) that is backed by a bank or an intermediary, or by a legal tender.

E-payment system in India, has shown tremendous growth, but still there
has lot to be done to increase its usage. Still 90% of the transactions are cash
based. So, there is a need to widen the scope of digital payment. Innovation,
incentive, customer convenience and legal framework are the four factors which
contribute to strengthen the E-payment system.

The aim of this study is to explore the problems, challenges and

perception of digital payment system. The study also focuses on the different
modes of digital payment system is most preferred by the customers as an easy
payment mechanism. Hence the problem is stated as “A study on problems and
challenges on digital Payment System as an ease of payment mechanism among
customers in e-commerce scenario with special reference to Kottayam District ”

1.3. Objectives of the study:

To understand the awareness of digital payment among customers.

To evaluate the digital payment preferences by customers.
To recognize the accessibility and usability of digital payment systems.
To know the factors enhancing the use of digital payment.
To put forward the suggestion for the study

To analyse the problems and challenges of growth of digital payment

system in the current marketing scenario.
1.4. Methodology of study:

The present study is carried out in Erode district and 100 consumers are
selected by using simple random sampling method. The percentages are
calculated to understand socio-economic status of consumers and mean and
standard deviation are worked out for perception of consumers towards digital
payment.

1.5. Sampling :

Convenience Sampling technique is used for selecting appropriate samples of

customers for the collection of data.

1.6. Research Design:

The study follows the descriptive method of research to measure, evaluate and
analyse the impact of online payment apps among customers. Primary data has
been collected through questionnaire.

1.7. Scope of the study

The scope of this study is very wide because there are so many opportunities
for digital transactions in the future. India is among the fast emerging as one of
the largest and strong economies. For sustained development and growth with
robust economic development, certain integral factors like improved
transparency, corporate governance etc, play a major role.
1.8. Area of the study:

The Respondents are from Modakkuruchi area Erode district majority of data
is collected with students

1.9. Tools for analysis:

Simple tools: For verifying the validity of data formulated in the study, statistical
tools like tables, figures, percentage and Likert scale analysis were used.
Statistical tools are involved in carrying out a study include planning, designing,
collecting data, analysing, drawing meaningful interpretation and reporting of the
research findings

1.10. Frame work of study:

The data collected were subdued into a digestible account by appropriate

tabulation. The basic tools of statistical analysis like simple percentage were
employed.

1.11. Limitation of study:

The study was conducted in the Erode district Modakkuruchi area. The
perception of the smart phone users differs from district to district. Hence, the
findings and conclusions arrived out of the study may or may not be applicable
to the other district of Tamil Nadu.
The sample size is limited to 100 customers only some of the respondents
were non-cooperation. Time is one of the major limitations. At most care should
be taken by the researchers to choose the correct from the respondents.
1.12. Review of literature:

1) Kaur, Puneet. Examines that mobile wallet apps have been

increased trend dramatically. It is useful for customers and effectiveness
towards transactions and safety payments on behalf this still the mobile wallets
not extended in markets.

2) Ghosh, Gourab. Describes that advancement of information and

communication technology opened the gate way for modern methods of
payments. The growth in smart phone and access to internet made life easier for
the people and which gave advent to digitalization. Digitalization not only
improved trade and commerce but it also made transaction of payment smooth
and fast.

3) Vinitha,K.,and S.Vasantha. Digital revolution has altered the

routine life style of people. The power of world wide web and digital payments is
having pivotal role in getting connected and making any time anywhere payments
at your attain user satisfaction and there by leads to consumer loyalty.

4) Pillai, Sruthy S., G. Sandhya, and G. Rejikumar. They describe

the trend shows that more people prefer using the non-cash modes when cash
shortage was at its crest even for small transaction matter. It shows that there is a
significant positive influence of simplicity and interoperability on the mobile
payment adoption, timely contacts and security proved to have a negative
influence on the dependent variable. People are more concerned about the
security aspects as they believe that their people are more concerned about the
security aspects as they believe that their monetary details are not safe while
doing online transactions.

5) Rathore, Hem Shweta. In today-world, smart phone has become

essential part of daily life. Due to technology, mobile users can nowadays use
their Smartphone’s to make money transaction or payment by using applications
installed in the phone

6) AĞAN Büşra (2020) studied the influence of the Covid-19

pandemic on the financial banking sector. The goal of this article is to examine
the digital payment system's response to the Covid-19 pandemic by charting the
evolution of debit and credit card payment amounts from 2019 to 2020, as well
as to establish a causal relationship between GDP and credit card expenditure.
The findings revealed that the Granger causality test only works in one direction,
from GDP to credit card, and that there is no second-way causality between
them.
7) Jimmi jose and DR.Sebastian Tharapil Joseph (2021) studied in
the current pandemic crisis, it is best for everyone to avoid physical contact,
mingling with others, and going to physical brick and mortar stores and
shopping centres. The use of digital payment systems has grown dramatically,
and their importance has grown by leaps and bounds as well. This study aims to
verify the impacts of digital payment systems and their impact on individual
savings, as well as to learn about people's perceptions of digital payment systems
and their impact on their money savings. During Covid-19, 200 samples were
chosen based on gender, age, occupation, qualification, and yearly income to
learn about digital payment, using a digital payment app, the benefits and
purpose of using a digital payment app, time savings, and the influence on
money generation

8) Allicia Deana Santosa, Nuryanti Taufik, Faizal Haris Eko

Prabowo, Mira Rahmawati (2021) examined the baby boomer and X
generation's intentions to use digital payments in the future (Unified Theory of
Acceptance Technology). During the epidemic, data was collected from 320
consumers aged 40 to 74 who had just started utilising digital payments. The
data was analysed using structural equation modelling. The findings show that
UTAUT indicators have a favourable impact on user satisfaction. Inertia is
influenced by user pleasure. Overall contentment and inertia have a good impact
on intention to continue. As a result, digital payment firms and banks with
digital services can broaden their target demographic beyond Millennial by
focusing on the older generation, such as baby boomers and the X generation

9) S.Manoharan, Saravanan M.P, S.Paneerselvam (2021) examined that

how people plan to use digital payments throughout the epidemic. Using the
judgmental sampling technique, a survey questionnaire was created to acquire the
relevant information from 271 respondents. SPSS and AMOS were used to
analyse the data. Effort expectation and habit were found to have a favourable
effect on behaviour intentions among the seven constructs studied. The effects of
social influence, enabling condition, and price value on behaviour intentions were
not found. A fairly substantial negative link between performance expectancy and
hedonic motivation on behaviour intentions was also discovered. When compared
to previous research, our findings for a few constructs were consistent with
previous findings, while others were not.
10) C Chaudhari , A Kumar (2021) founded that The Indian economy
has shown a rise in digital payments in the retail sector as a result of the
pandemic. When comparing the prepandemic financial year 2019/20 to the
pandemic-hit financial year 2020/21, there was a significant increase in both
volume in the digital payments (retail) sector. The impact has been favourable,
demonstrating the ability of India's digital payment infrastructure to handle a
significant number of financial transactions via digital platforms. The seeds of
demonetization seeded on November 8, 2016, through demonetization, have
produced fruit, allowing the payment system to smoothly navigate the huge spike
in digital payments expected in 2021.

11) MUSYAFFI, Ayattulloh Michael, SARI, Dewi Augustin pratama,

RESPATI Kiamayanti (2021) has explained Performance expectancy, effort
expectancy, and personal innovativeness all had a strong favourable effect on
behavioural intention to use digital banking, according to this study. Perceived
security, on the other hand, has a strong detrimental impact on behavioural
intention. Furthermore, social influence has little discernible effect on
behavioural intention. Facilitating Conditions and behavioural intention, on the
other hand, have a considerable favourable impact on the use of digital payments.
The outcomes of this study show that, particularly in the COVID-19 epidemic,
the usage of technology and personal mental variables influences the adoption of
digital payments.

12) Wesam Shishah, Soha Alhelaly (2021) studied the COVID-19

outbreak in Saudi Arabia, an opinion survey was performed to investigate the
experience of using contactless payment technology. Researchers also looked at
the factors that may have influenced this situation. The findings revealed that
since the commencement of the COVID-19 pandemic, favourable experiences
with contactless payment technology had increased. Moreover, the survey found
that the major reasons for adopting contactless technology for payment during the
coronavirus outbreak were health safety and hygiene, whereas the main issue for
not using it was transaction security.
CHAPTER OF SCHEME

CHAPTER I - The study of digital payment

This chapter contains introduction and design of the study, statement

of the problem, scope of the study, research methodology, Limitations of the
study and chapter schemes.

CHAPTER II - Digital payment apps.

It is an economic that take place online between consumer and seller

with a specific flatforms like Rupay, GPay, etc.

CHAPTER III - Market research

It is the systematic collection and analysis of data relating to sale

and distribution of financial products and services.

CHAPTER IV - Analysis and Interpretation

It is the majoring percentage of the respondents were belong to the
customers

CHAPTER V- Finding, Conclusion and Suggestion

It provides summary of the findings from the analysis and conclusion

of the study.