Travel firms are adopting ‘cash-on-delivery’ payments to cater for the half a billion Indians without a bank account, says the WTM Global Trends Report 2015, in association with Euromonitor International.
Released today (Monday 2 November) at World Travel Market London, the report highlights the scale of the untapped market of India’s unbanked population, and how cash-on-delivery (CoD) models are evolving to serve these consumers.
According to the WTM Global Trends Report 2015, in association with Euromonitor International, which is celebrating its 10th anniversary at WTM London 2015, more than two thirds of India’s population live in rural areas and only 7% of India’s villages have a bank.
These countryside consumers make up the majority of India’s unbanked – an estimated 500 million people in 2015.
“For many of these consumers, travel and online booking of tickets may appear an unrealistic dream, but the situation is slowly changing as travel companies reach out to the unbanked,” said the report.
CoD payments have been successful with online retailing, so several Indian travel companies have now adopted the service for ticketing.
Consumers book online, often using a travel agent or internet café, and a cash payment is collected, after which the ticket can be downloaded or delivered.
Jet Airways has signed up with GharPay, which specialises in CoD payments, enabling customers to book online, and tickets are emailed after the payment is collected.
Indian Railway Catering and Tourism Corporation (IRCTC) established BookMyTrain.com, which allows passengers to book online, for the ticket to be delivered at home where the payment is made.
CoD is not restricted to transportation ticketing, said the report.
Travelguru, the hotel booking site, also offers this service, provided by doorstep CoD brand Delhivery.
Cleartrip, one of India’s leading online travel agencies, reported that 26% of online users and 18% of mobile users prefer to pay for all their travel bookings by CoD in 2015.
The report highlights the potential for significant further growth, commenting: “Internet access for India’s rural population and smaller cities looks set to expand dramatically, leading to over 320 million internet users by 2019.
“This improved internet access, combined with a growing availability of mobile phones, is likely to result in increased mobile payments and applications for unbanked consumers. “In August 2015, 11 companies, including Airtel and Vodafone, were granted licences for banking transactions such as deposits and payments.
“This move is hoped to bring mobile banking to India’s unbanked, similar to Kenya’s M-Pesa m-commerce, used by two thirds of adults in Kenya to make purchases, including travel.”
World Travel Market London, Senior Director, Simon Press said: “The sheer scale of this untapped market is staggering, so it’s great to see how technology is bringing travel opportunities to millions of consumers.”
Euromonitor International, Head of Travel, Caroline Bremner said: “For many emerging markets, these types of purchases can be seen as a way of creating trust in online bookings as payment and ticket delivery are carried out at the same time.
“It will make a dramatic difference to huge numbers of people who have previously been unable to enjoy benefits afforded to those in more developed economies – and open up many opportunities for the travel industry in India and around the world.”
About World Travel Market London
WTM London, the leading global event for the travel industry, is the must-attend four-day business-to-business exhibition for the worldwide travel and tourism industry.
Almost 51,500 senior travel industry professionals, government ministers and international press, embark on ExCeL – London every November to network, negotiate and discover the latest industry opinion and trends at WTM.
WTM London, now in its 36th year, is the event where the travel industry conducts and concludes its deals. WTM 2014 will generate around £2.5 billion of travel industry contracts.
WTM London is part of Reed Travel Exhibition’s World Travel Market events, which also includes Arabian Travel Market, World Travel Market Latin America and World Travel Market Africa. www.wtmworld.com
World Travel Market Events
World Travel Market is comprised of the leading leisure travel events in the world; World Travel Market London, WTM Latin America in Sao Paulo, WTM Africa in Cape Town and Arabian Travel Market in Dubai.
New events for 2016 are WTM connect Asia and WTM connect China, which join WTM connect Ski and International Golf Travel Market. These unique one-to-one events are targeted at leisure and niche travel markets, allowing exhibitors to exclusively meet with elite hosted buyers.
The World Travel Market events are attended by the global travel and tourism industry’s senior executives to conduct business deals and discover the latest research, insight and opinion.
In 2014, the World Travel Market events facilitated around $7 billion in industry deals from negotiations between the more than 15,000 buyers, 9,500 exhibitors (1,500 main stand holders and 8,000 stand sharers) in attendance of its four events.
WTM is part of Reed travel Exhibitions, the leading events organizer in the travel industry, and is owned by the world’s leading events organiser Reed Exhibitions.
Reed Travel Exhibitions
Reed Travel Exhibitions (RTE) is the world’s leading provider of exhibitions in the travel and tourism industry. Its wide-ranging portfolio of events around the globe covers leisure travel, luxury travel, meetings, incentives and business travel, as well as golf, ski and spa travel.
RTE, which organises more than 22 events around the world, includes three divisions; World Travel Market, IBTM World and International Luxury Travel Market.
RTE is a business unit of Reed Exhibitions.
About Reed Exhibitions
Reed Exhibitions is the world’s leading events organiser, with over 500 events in 43 countries. In 2014 Reed brought together over seven million event participants from around the world generating billions of dollars in business. Today Reed events are held throughout the Americas, Europe, the Middle East, Asia Pacific and Africa and organised by 41 fully staffed offices. Reed Exhibitions serves 43 industry sectors with trade and consumer events. It is part of the RELX Group plc, a world-leading provider of information solutions for professional customers across industries.
About Euromonitor International
Euromonitor International is the world’s leading provider for global business intelligence and strategic market analysis. We have over 40 years of experience publishing international market reports, business reference books and online databases on consumer markets. We deliver market research solutions to support strategic planning for today’s increasingly international business environment. Our research offers in-depth market analysis on consumer goods and services industries worldwide, as well as economic, demographic and socio-economic data and insight on countries and consumers. Euromonitor International is headquartered in London, with regional offices in Chicago, Singapore, Shanghai, Vilnius, Sao Paulo, Santiago, Dubai, Cape Town, Tokyo, Sydney and Bangalore, and has a network of over 800 analysts worldwide.