Amid the demonetisation chaos when most people are staring at a cash crunch with ATMs dried up and serpentine queues becoming an order of the day in front of all banks, there is a silver lining for those manufacturing handy point-of-sale (POS) devices.
At point-of-sale (POS) device-making startup Ezetap's manufacturing unit in Bengaluru, employees have had to put in extra hours since last week, as the company is accelerating the pace of hardware production to meet surging demand for the machines.
"The liquidity crunch has forced merchants who have hitherto relied only on cash transactions to place orders for POS machines, while e-commerce companies are turning from cash-on-delivery (CoD) to 'card-on-delivery...the employees at the facility have been working multiple shifts as we have increased the pace of production. Shipments have also gone up this week," Bhaktha Keshavachar, CTO at Bengaluru-based Ezetap, told Economic Times.
"The employees at the facility have been working multiple shifts as we have increased the pace of production. Shipments have also gone up this week," he said, adding that there has been a multi-fold increase in transactions from existing merchants, and a higher demand from new merchants.
The situation is similar at Mswipe, a mobile point-of-sale (mPOS) solutions provider, which has also registered a surge in merchants seeking new terminals.
"Those (terminals) are being installed on a daily basis. Typically, we sign up around 10,000 merchants a month, and we are now projecting it to double," said Manish Patel, founder of Mswipe.
"The upsurge in demand is a good problem to have. Employees are putting in extra hours and we are making sure that terminals are delivered and activated. Ultimately, it comes down to distribution and ability to process the requests," he said. Demand for PoS terminals and card-swiping machines is pouring in from merchants across industries.
“Apart from card swiping machines, demand has doubled for other Point of Sale hardware products such as POS terminals, receipt printers, cash drawers, barcode scanners and barcode printers, hand-held pos devices and tablet POS to do business effectively. Software providers to integrate all these hardware products and create specific applications for each business too are in great demand,” said Bhaskar Venkatraman, the founder and CEO of Millennium Soft-tech, a pioneer in providing POS solutions to retailers across India.
On B2B online marketplace IndiaMart, the number of requests placed for PoS machines has increased from 20-30 enquiries every day to 140-150, while for card-swipe machines, the number has increased from 100 to 2,000 enquiries per day in the past week. This adoption of card payments is being seen as a sustained shift rather than a temporary up-tick.
"We are seeing a behavioural change in merchants and customers. There are trends that this will be a sustained change in the long run," said Keshavachar. Pine Labs, one of the largest provider of card-swipe machines in the country, has also noticed a spike in repeat customers.
"This is not a short-term trend, and we anticipate the speed card transactions are growing to be much higher," said Lokvir Kapoor, chief executive of Pine Labs. It is not just PoS hardware that is in demand. Newer technologies, such as sound-based proximity transaction offered by fintech startup ToneTag, are seeing faster adoption now.