How Modi’s currency ban is helping Chinese fintech investors in India

Chinese e-payment players could be the biggest beneficiaries of New Delhi’s sudden move to ban high denomination banknotes as harried Indians desperately seek cashless options.

Alibaba is already the biggest backer of two of the top e-wallets, Paytm and Snapdeal-owned Freecharge, while the other two biggest players, MobiKwik and Oxigen, claim they are on the verge of landing Chinese investment as well.

According to a chief executive of an Indian e-wallet player currently “in negotiations” with Chinese investors who was reluctant to be identified, the currency ban has opened up huge opportunities for e-wallets and almost every other player is wooing investors, especially from China.

In the world’s most sweeping currency policy change in decades, Prime Minister Narendra Modi on November 8 announced all 500 and 1000 rupee notes would be taken out of circulation, sending hundreds of thousands of Indians queuing up at banks to deposit idle cash or replace them with new notes.

Since the move invalidated 86 per cent of the total currency in circulation, an unprecedented cash crunch has ensued, prompting more and more Indians to seek succour in e-wallets.