Of all the apps launched by the government, BHIM is the first app to gain over four millions of users. The app recently received the awaited update which covers up the existing issues with the app. Now when BHIM is polished and works better than before, is it good enough to give existing e-wallets a run for money?
Can BHIM serve all your banking needs without needing multiple apps on your smartphone? Who is BHIM for? Why will we always need e-wallets like Paytm and FreeCharge?
After giving a deep thought about how BHIM and e-wallets differ, we got a clearer idea about the importance of each of them. Both the platforms have their own pros and cons, depending on what the need is.
The first thing we all must know is the difference between BHIM and e-wallets (Paytm, FreeCharge, MobiKwik etc.).
BHIM is an UPI based unified app which can be synced to any UPI-enabled bank account. The app is developed byNational Payments Corporation of India (NPCI). BHIM app has a minimalistic and user friendly interface with just couple of options and limited settings. It enables users to create a VPA (virtual payment address) using a verified mobile number connected to their bank accounts. The VPA is your phone number with ‘@UPI’ at its end. For example, 9999xxxxx0@UPI. This enables users to transfer money from their account to the receiver’s bank account without any third party involvement in between. Provided both the users have the UPI id or address.
On the other hand, e-wallets like PayTM let you add money to the wallet. This money can either be used to transact on associated merchant portals or to transfer someone who uses the same wallet. Users can use their bank accounts or credit cards to load money to the e-wallet. No UPI platform is involved in these transactions. Unlike BHIM there is no bank to bank transaction happening in this case.
There is only one way to transact using e-wallets whereas BHIM allows you to transact using IFSC and MMID, using a phone number if the bank supports UPI, and also using the unique QR code. With the help of UPI you can also transact offline using *99# USSD code. PayTm also offers offline payment and transfers but the process is not as simple as BHIM.
The app interface is as minimalistic as it can be. More importantly, BHIM app now supports 7 different languages including Bengali, Oriya, Gujarati, Kannada, Malayalam, Tamil and Telugu, besides English and Hindi. Both the factors lead to a huge advantage that is ease of use, which is somewhat lacking in e-wallet apps. Most of the e-wallet apps have a complex interface which may not prove handy to users in semi-urban or rural areas.
One small but important factor is the app size. Because of the light and clean interface, the app takes less than 2MB space on your phone. Not every user has a phone that allows 50MB-100MB space occupied by e-wallets. BHIM also cuts down the space occupied by the net-banking app in case you use it.
Users can keep a check on their bank account balance using BHIM app, which is not possible with e-wallets. If you take PayTM’s example, the setup is also much easier on BHIM if compared to the e-wallet app.
BHIM also takes a lead when it comes to security and reliability. Being launched by National Payments Corporation of India (NPCI), the app is backed by a government owned organisation, which automatically sounds more reliable than a privately owned wallet. Although, PayTm has also not come across any such fraud or threat till now but it eventually takes a lot more time to fix things up if something goes wrong.
You do not get attractive offers, deals and cash back on BHIM app for making payments, whereas almost every e-wallet app gives you such deals.
As of now, BHIM app is not associated with third party vendors and merchant portals directly. Which does not allow the users to pay at places as simply as it is with e-wallets.
In terms of success rate, e-wallets like PayTm are currently more reliable. There are several bugs in BHIM which still persist after the recent update, and the servers are not as robust as the major e-wallets.
You can use multiple accounts to load money on your e-wallets (PayTm, MobiKwik or Freecharge) whereas BHIM only allows one bank account to be linked with one app. To make payments from a different account, you need to switch the bank from the options menu.
Those from rural areas who are not used to internet banking will find BHIM as the best choice to start with. The easy interface and local language support will be a huge plus for BHIM in areas where e-wallets and net banking methods are uncommon.
For those living in metro cities who are aware of e-commerce, net banking and e-wallets will still prefer PayTm or any other e-wallet for payments, as it offers indirect benefits to them. BHIM does not have any such services and features as of now and that is a major point where e-wallets are still very competitive.
Once the Aadhaar Pay service is enabled with BHIM app, it will allow users to make and receive money using their Aadhaar ID and the fingerprint. This will surely help the ones who cannot use mobile for digital payment. The service is not yet live so we will not count it as an advantage to BHIM as of now.
If BHIM is accepted at online vendors, physical stores, offices, public transport and places like these, it will lose the advantage of its simplicity. Hence, it is not going to be an easy task for the developers to make it stand against the services offered on privately owned e-wallets.
Can BHIM serve all your banking needs without needing multiple apps on your smartphone? Who is BHIM for? Why will we always need e-wallets like Paytm and FreeCharge?
After giving a deep thought about how BHIM and e-wallets differ, we got a clearer idea about the importance of each of them. Both the platforms have their own pros and cons, depending on what the need is.
The first thing we all must know is the difference between BHIM and e-wallets (Paytm, FreeCharge, MobiKwik etc.).
BHIM is an UPI based unified app which can be synced to any UPI-enabled bank account. The app is developed by
On the other hand, e-wallets like PayTM let you add money to the wallet. This money can either be used to transact on associated merchant portals or to transfer someone who uses the same wallet. Users can use their bank accounts or credit cards to load money to the e-wallet. No UPI platform is involved in these transactions. Unlike BHIM there is no bank to bank transaction happening in this case.
Advantages of BHIM over e-wallets
The first and the biggest advantage is the bank to bank transaction process, which makes transaction faster and more reliable when compared to e-wallets. With BHIM you can send, receive money and also use QR code to scan and pay just like e-wallets.There is only one way to transact using e-wallets whereas BHIM allows you to transact using IFSC and MMID, using a phone number if the bank supports UPI, and also using the unique QR code. With the help of UPI you can also transact offline using *99# USSD code. PayTm also offers offline payment and transfers but the process is not as simple as BHIM.
The app interface is as minimalistic as it can be. More importantly, BHIM app now supports 7 different languages including Bengali, Oriya, Gujarati, Kannada, Malayalam, Tamil and Telugu, besides English and Hindi. Both the factors lead to a huge advantage that is ease of use, which is somewhat lacking in e-wallet apps. Most of the e-wallet apps have a complex interface which may not prove handy to users in semi-urban or rural areas.
One small but important factor is the app size. Because of the light and clean interface, the app takes less than 2MB space on your phone. Not every user has a phone that allows 50MB-100MB space occupied by e-wallets. BHIM also cuts down the space occupied by the net-banking app in case you use it.
Users can keep a check on their bank account balance using BHIM app, which is not possible with e-wallets. If you take PayTM’s example, the setup is also much easier on BHIM if compared to the e-wallet app.
BHIM also takes a lead when it comes to security and reliability. Being launched by National Payments Corporation of India (NPCI), the app is backed by a government owned organisation, which automatically sounds more reliable than a privately owned wallet. Although, PayTm has also not come across any such fraud or threat till now but it eventually takes a lot more time to fix things up if something goes wrong.
Advantages of e-wallets over BHIM
E-wallets are not just a mode of payments but they also allow us to shop online, booking tickets, recharge phone, pay bills, recharge metro cards and even much more. BHIM is very straightforward and does not offer such features and facilities inside the app.You do not get attractive offers, deals and cash back on BHIM app for making payments, whereas almost every e-wallet app gives you such deals.
As of now, BHIM app is not associated with third party vendors and merchant portals directly. Which does not allow the users to pay at places as simply as it is with e-wallets.
In terms of success rate, e-wallets like PayTm are currently more reliable. There are several bugs in BHIM which still persist after the recent update, and the servers are not as robust as the major e-wallets.
You can use multiple accounts to load money on your e-wallets (PayTm, MobiKwik or Freecharge) whereas BHIM only allows one bank account to be linked with one app. To make payments from a different account, you need to switch the bank from the options menu.
Which one is for whom?
Logically speaking, there is no comparison when it comes to usefulness of any of the services, whether it is BHIM or any e-wallet. As of now, BHIM app is better when you have to transfer funds from one account to another and PayTm like wallets are better when you have to pay to different services like mobile recharge, bill payment, movie bookings etc.Those from rural areas who are not used to internet banking will find BHIM as the best choice to start with. The easy interface and local language support will be a huge plus for BHIM in areas where e-wallets and net banking methods are uncommon.
For those living in metro cities who are aware of e-commerce, net banking and e-wallets will still prefer PayTm or any other e-wallet for payments, as it offers indirect benefits to them. BHIM does not have any such services and features as of now and that is a major point where e-wallets are still very competitive.
Once the Aadhaar Pay service is enabled with BHIM app, it will allow users to make and receive money using their Aadhaar ID and the fingerprint. This will surely help the ones who cannot use mobile for digital payment. The service is not yet live so we will not count it as an advantage to BHIM as of now.
Conclusion
There is no doubt that BHIM is a potential replacement of existing e-wallets, but calling it better than any of them is not convincing as of now. If NPCI manages to get different merchants on board like Paytm, it will can become a one-stop solution for all the transactions.If BHIM is accepted at online vendors, physical stores, offices, public transport and places like these, it will lose the advantage of its simplicity. Hence, it is not going to be an easy task for the developers to make it stand against the services offered on privately owned e-wallets.
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