ATM Maker Diebold Says India is a High Growth Market

With a presence in over 4,000 cities and towns, Ohio-based Diebold has operated in India for more than 25 years and is well versed in the country’s banking and financial narrative. The company recently completed integration after acquiring German corporation Nixdorf.

In an interview with CXO Today, Jaivinder Singh Gill, managing director – South Asia and vice president Operations – Asia Pacific, Diebold Nixdorf, discussed the future of the banking and e-Point of Sales (PoS) market in India.

Lightly edited excerpts from the interview:

The current scenario of banking

Gill: The number of banking outlets in the villages went up from 67,694 in March 2010 to 586,307 in March 2016 after India’s central bank permitted the appointment of Banking Correspondents – entities engaged by a bank to provide banking services in geographical territories where banks are under represented. A banking correspondent works as an agent of the bank and substitutes for the brick and mortar branch of the bank. The number of urban locations covered through such Banking Correspondents also surged from 447 in March 2010 to 102,552 in March 2016.

On the changing consumer patterns in Indian banking

Gill: Since currency demonitization in November 2016, ATM transactions have increased by 26% and the value of ATM transactions is up by 83%. Customer transaction behavior is now a mix of both ATM and PoS transactions. We see the increasing usage of mobile phones as a banking channel and the use of social media by millennials to interact with banks.

On the implications of India moving towards a digital economy

Gill: The PoS market is expanding fast in India with digital adoption on the upswing. Some data facts highlight that there has been a 67% growth in the absolute number of terminals across the country. There has been a 64% growth in the number of P0S transactions in India.

The PoS market is directly linked to the growth in the retail industry which has a very high growth potential in India. This high growth will be see in Tier 2 and 3 cities/ towns due to rapid urbanization, growing aspiration levels, and availability of credit.

Augmented Reality and Virtual Reality are two key levers which retailers need to focus on to drive footfalls. Adopting an Omni-channel approach is another major criterion on which the retailers need to shape their strategy on.

On how products like PoS or ATM machines will support the economy

Gill: The Indian retail industry has emerged as one of the most dynamic and fast-paced industries due to the entry of several new players. It accounts for over 10 percent of the country’s GDP and around 8 per cent of the employment. India is the world’s fifth-largest global destination in the retail space and the Indian retail market is expected to nearly double to $1 trillion by 2020, driven by income growth, urbanization and attitudinal shifts.

The e-POS solution delivers a seamless, Omni-channel retail experience to enhance competitiveness. It can rapidly roll out pre-configured templates to support diversification into different retail sectors and accelerate international expansion with centralized store-lifecycle management. The technical benefits are also immense: it enables a reliable, secure and easily manageable platform for retail asset management based on trusted industry standards. It also comes with comprehensive data exchange options and offers support for centralized and client/server configuration.

On the roadmap for the India market in the next one year

Gill: We expect high growth in cash recycling with almost 30% y-o-y market growth expected in 2017/18 per our internal estimates. Branch redesign and teller automation is also a focus area for banks to reduce their operational costs. Growth is also expected in cash system logical security solutions, multi-vendor software solutions, services, and e-POS growth in Tier 2/ 3 market segments. The ATM replacement market with banks opting for technology refresh also has immense potential. This growth market is predicted to reach up to 52% of the overall procurement by 2021.

Mobile and Stationary PoS

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Posted on by Gunjan Bagla
Gunjan Bagla
California-based management consultant Gunjan Bagla runs Amritt, a consulting firm helping American companies to succeed in India. Amritt is the trusted advisor for India market research, India business development, India market entry, Global Engineering, Global Technology Scouting, India R&D and Open Innovation. Gunjan is author of "Business in 21st Century India: How to Profit Today from Tomorrow’s Most Exciting Market" (Hachette Book Group, 2008), Amazon's top rated title on the subject. He has appeared as the India Expert on BBC Television, Bloomberg TV, Fox Cable Business and has been quoted in the New York Times, the Los Angeles Times, the Hollywood Reporter and Business Week for his expertise on India.

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