Digital payments companies see bumper transactions in consumer demand for gold

Digital payments companies have recorded bumper transactions during Dhanteras and the pre-Diwali shopping festival. Driven by consumer demand for gold during this time, payments companies have recorded a strong show in transactions and, at the same time, seen a wide adoption of digital gold, according to the Economic Times.
 
The largest payments company, Paytm, said that since its launch, the company has sold more than 2 tonnes of gold through its application and around 10 million people have bought the metal through the app. The company said Paytm Gold has witnessed widespread adoption across Delhi, Haryana, Uttar Pradesh, Maharashtra, West Bengal and Karnataka with two-thirds of the overall adoption coming from tier-II and tier-III cities.
 
Paytm’s Bengaluru-based competitor PhonePe said it saw a significant jump in sale of digital gold on its platform. The company claimed to have recorded a 200% increase in sale of gold during Dhanteras compared to a normal business day. More than 40% of the pincodes in the country saw gold purchase on PhonePe’s application. It also claimed to have recorded a 400% jump in ticket size of gold purchases on its platform.

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Changes in Our Business Model
 
 
25th Sept 2020
 
Greetings from Moneylife Advisory Services
 
Between financial years 2019-21, SEBI has come up with extensive changes to investor advisor regulations. On Sep 23, 2020, SEBI had issued new additional guidelines. This comes just two months after extensive changes announced in July 2020. Earlier, in December 2019 there was an ad hoc circular
 
As a result of these changes, IAs, cannot accept fees through credit cards, will have to sign a 26-clause investor agreement, have to maintain physical record written & signed by client, telephone recording, emails, SMS messages and any other legally verifiable record for five years. IAs were already asked to record the suitability and rationale for every piece of advice given, sign them and store them for five years.
 
While these extensive and frequent changes, designed to strengthen the conduct of IAs are well-meaning, these have sharply increased compliance efforts and cost. We, being online advisors, find many of changes harder to implement, compared to advisors working in the physical space. We will have to have an army of advisors, administrative and tech staff to be compliant. If we do this, we will have to divert money to these areas and the cost of our service will double. We want to remain the least-cost service in the market to benefit more and more people. In the circumstances, we are forced to change our business model from “advisory” to “research”. This will mean the following:
 
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Debashis Basu
Founder