It’s still too early to throw away your credit card, but bitcoins are making inroads in India as a mode of payment. India currently has around 50,000 bitcoin enthusiasts, with 30,000 of them actually owning the currency. With increasing ease of using them for purchases through mobile apps, bitcoins are quickly transitioning from being trading units to shopping currency.
Just a year ago, bitcoin owners in the country had few avenues for using the currency. Since the crypto-currency is technology driven, sellers need to have platforms to accept it. This is where things have changed in recent times. Unocoin, an Indian bitcoin exchange, has launched a ‘merchant gateway’ which enables business entities to accept bitcoins. Sellers like Sapna Book House, bus ticket booking portal eTravelSmart, Dharwad International School, fashion portal Fashiondiva.me, and internet platform service provider Indsoft.net are among those who have signed up and are now accepting bitcoins from their customers. Coinsecure, another Indian bitcoin exchange, is likely to introduce a merchant gateway in the coming months.
Zebpay, an app-enabled bitcoin mobile wallet, earlier provided for just trading of the currency. This June it entered the payment sphere; its users can now buy vouchers of Amazon, Flipkart, Freecharge, Bookmyshow and Makemytrip. In July, Zebpay also enabled its bitcoin-app users to recharge their prepaid or pay for their postpaid plans with telecom operators such as Vodafone, Airtel, Uninor, Tata Docomo, Reliance, BSNL and MTNL. This offering also covers several DTH service providers. The company sees at least 500 new users signing up for the bitcoin-app each week.
A couple of weeks ago, ePaisa, a mobile point-of-sale (POS), enabled brick and mortar stores to accept bitcoins. “Since our announcement, we have seen tremendous interest from brick and mortar stores and we expect to reach around 100 outlets by the end of the year,” says Siddharth Arora, co-founder and CEO of ePaisa. “All that the buyer has to do is select the bitcoin option at checkout. A QR code will pop up with the amount due and the customer will only need to scan that code using their own bitcoin wallet app. The store can receive the payment either in its bitcoin wallet or in the bank account,” explains Arora.
While the concept is new, some retailers have realized the advantages of accepting the currency. “When a merchant offers the bitcoin option, he reaps the benefits of lower transaction fees, no chargebacks, fraud prevention and quick payment. Merchants can instantly convert the bitcoins received into Indian rupees in their bank account,” says Sunny Ray, president, Unocoin.
The interest is not limited to e-commerce sites. Dharwad International School in Karnataka introduced bitcoins as an online payment facility for school fee this academic year. eTravelSmart, which offers 80,000-plus bus routes, started the facility in May and sees averagely five bitcoin transactions per month. “The bitcoin user base in India is increasing and cannot be ignored,” says Bhav Singh Bhukya, co-founder of YK Solutions, which owns the eTravelSmart portal. “Customers now pay their ticket fare in bitcoins. For instance, if the fare is Rs 1,000, bitcoins equal to this value are deducted from the customer’s wallet, which at present works out to 0.06269592 bitcoins,” explains Bhukya. In August, the buy value of a bitcoin fluctuated between Rs 14,000 and Rs 15,000.
Saurabh Agrawal, co-founder at Zebpay, says the most popular avenue for use of the cryptocurrency has been vouchers. “We buy vouchers from e-commerce companies and sell these online against bitcoins. We are seeing a monthly growth of 100%,” he says. However, the legality of bitcoins has often been a topic of debate. Advocate Vaibhav Parikh says bitcoins are legal in the country. “The dialogue around their illegality among potential investors or merchants is simply a fear of the unknown. The only word of caution — people should be wary of accepting bitcoins from outside India as exchange control regulations are applicable.” Parikh favours a self-regulatory mechanism like in the UK for India-based bitcoin exchanges and other players in the cryptocurency spectrum.
Click on the bitcoin logo below to buy, use or accept bitcoin. Unocoin is India’s most popular bitcoin wallet.
To read the bitcoin white paper, visit: https://bitcoin.org/bitcoin.pdf