Sodexo – Is there a logic for carrying these paper coupons?

Sodexo passes, haven’t we all used them and haven’t we all always felt what stupid system it is to first stand in queues and get that booklet and then count them at every grocery store or a restaurant to give it to the merchant, who also btw has a big problem of managing these vouchers and then handing it over to Sodexo. Not to forget the times when the exact amount of vouchers are not found and the merchants typically have a policy of not giving any change back on Sodexo vouchers. And the vouchers have an expiry date as well!! Doesn’t it all sound like a story from 1970 rather than 2016?

But we all use it because they help us save tax. Fine, but can’t this be done through an app?? So just imagine an employee app, which is sort of a wallet to which your employer can add meal credits online. So every month instead of waiting in a queue, you automatically get the credit in the app as you have registered your number against your employee id which can receive the meal credits. Now some might argue that in my last post I was talking against the wallets and now I am suggesting another one myself. But this is different from the other wallets as this one only stores meal vouchers and not real money.

So every month you receive credits in your app which you are able to use to make payments to merchants who can either have a merchant app or simply a QR code for their establishment and the credits are transferred from you to them. In one shot, it obviates the need for having a sales force which collects vouchers from merchants and hands over the money. The merchant can redeem the vouchers whenever he wants and is not dependent on the field executive’s visit.

So just summarizing the benefits for such an app:

1. Employees directly receives the meal credits in their account, just like salary
2. No need to carry the bundle everywhere you go
3. You can give the exact amount rather than worrying about the change
4. Merchants don’t have to manage the vouchers
5. Merchants can redeem the vouchers on the go
6. No sales team required to manage collection of vouchers
7. No paper so trees don’t get cut

The Curious Case of Wallets in India

The more I use wallets such as PayTM, PayU, Mobikwick etc. the more I wonder if they have eased the way I make payments or have they complicated it more. Come to think of it, I have to keep adding money to my wallet, and remember to pay it when the bill for my credit card, which was used to add money to the wallet, is due. So basically I have added another step in my payment process. Some might argue that these wallets have made it easier to transfer money to merchants who don’t have the bandwidth to use VISA, American Express etc. and hence digital money can now be used at these merchants. And I agree with that statement BUT what if tomorrow all these credit card platforms wake up and realize that a plastic card is really an obsolete thing and that they should try and move to a digital / smartphone based platform which makes it very easy for even a small merchant to use, these wallet companies will fall on their face because their true value add is now gone.

Let me drill this down further to make it more convenient to understand. Assume that VISA comes out with an app in which you can add all your visa card details. So say you have an ICICI VISA debit card and a Standard Chartered VISA credit card and you fill in your details or maybe you get virtual VISA cards from these service providers. The merchants also don’t need a dumb instrument like a swipe machine, which runs on an even more dumb telephone line (archaic). All he needs is a smartphone with a data connection and a VISA merchant app. The customer and merchant interaction can happen through various ways – QR code, NFC etc. etc. Actually the merchant doesn’t need a smartphone as well. Just a printed QR code for his establishment should do the trick, as whenever a transaction happens, he will receive a message on his feature phone confirming the transaction. The customer on the other hand will get to choose which card (out of the digital VISA cards he has in that app) he wants to use for that particular transaction. The 2 factor authentication can easily be applied to this way of making payments.

And then ofcourse there is potential of a single app which works similar to the UPI platform RBI has introduced which can store all your mastercards, Visa, Amex, Maestro and RuPay. This app will truly be a digital wallet and not an additional piggi bank, but a reflection of your credit and debit cards. One can hold wallet accounts (PayTM, PayU etc.) also in this Digital Wallet and make transactions from them wherever they are offering discounts. An additional feature could be that when the customer is trying to make a payment, the app suggests which card to use depending on offers running with the cards available with the customer.

-- Himanshu Makhijani