What are existing digital payment systems that are competing with crypto?


In a recent AMA with Haseeb Qureshi, we talked about how crypto is also competing with current digital payment systems. For example, in India, PayTM is widely accepted by all vendors, including street vendors who sell coconuts.

What are examples of well-functioning digital payments that exist today in various countries? How is crypto better than these existing digital payment systems?

@bhaumik @Srikanth @ankit @katja … and others. Please chime in :point_up:


Apart from cash and debit/credit cards, India has two other modes of payment both online and offline.

1. Digital wallets

Famous digital wallets in India are PayTM and MobiKwik.

How they work:
i) You add money to your digital wallet from your bank account.
ii) Pay offline using QR codes or online from your wallet.
After demonetisation of the Indian rupee in 2016, PayTM launched a nationwide campaign due to which it became extremely famous offline.
The similar wallet in China is WePay from WeChat. It is used more than cash in China. (I know its true, if someone can help me with the proof :slight_smile: )

It is something similar to how Lightening Network will work for Bitcoin, so citizens of India and China already know how the experience would feel.

  1. UPI (Unified Payments Interface)
    The Reserve Bank of India saw that individuals/merchants wanted efficient means to transfer Rupees online and digital wallets were fulfilling that need. Hence, they launched UPI. UPI helps you transfer funds directly from your account to another account in seconds.

How it works:

  1. Ask the other individual/merchant for their UPI Id. (Similar to email ids - 123456@upi)
  2. Transfer the amount to the address.
    Its that easy. No need for wallets. No need to add beneficiaries and wait. No bank hours. Purely instant.

Many a times it becomes difficult to explain the need of Bitcoin to friends as they just counter me by asking - “Isn’t that UPI?”

Both, digital wallets and UPI are accepted widely by merchants offline in India - be it for smokes, groceries, coconut vendors etc.


How trustful are the citizens of the govt?


Did not understand “citizens of the govt.”.


Do people in India trust the govt and their ability to keep the currency stable?


As of now, yes - there is no outrage on the monetary policy as such in the country.

The biggest reasons people might need crypto in India is to control what you do with your money. UPI is limited to $1500 a day, many banks don’t allow you to buy crypto even though it is not illegal.

Even though transactionally India might not need crypto, however owning your money might be the biggest need.


If lack of trust isn’t an issue, then the next question to ask is: what other benefits does Crypto offer that regular financial systems can’t? (e.g. micro-transactions, programmability)


Programmability without a central authority is extremely useful. Crypto would be needed for that.

Micro-transactions within borders have been covered in India and China. However, micro-transactions which cross the national border are still a pain. Crypto is extremely useful there.


@ankit agreed! strongest competitor is indeed UPI. Government could use a non anonymous cryptocurrency to fight corruption but again… Paytm and all are already using KYC, so competition is tough as people wouldn’t switch until they get something new except for ppl like us who… just like cryptocurrencies :smiley:


I haven’t needed cash in Finland probably for years. The banks operating in the Nordics have good websites and mobile bank applications where you can do all the payments. You almost never have to go to visit a bank. All the stores accept card / mobile payments. Even individual people at flea markets accept digital payments with mobile phones.

There’s a mobile payment system called MobilePay (by DanskeBank and usable with other banks as well) with which it is easy to send money to friends, share bills, pay etc.

In general, many people in the Nordics seem to be excited about blockchains but don’t understand why cryptocurrencies would matter - digital payment systems work so well and people trust banks and currencies. However, e.g. MobilePay is a service by DanskeBank that laundered more money than Bitcoin’s market cap through Estonia, not great.



wow really? just googled it. had no idea this happened.


Yeah that money laundering case is really nasty.


Two of the countries I have recently lived in.

1. India : Adding to @ankit’s answer

  • Some 2009 Flashback : 10 years ago if you would have to recharge your mobile phone, you would go to a nearest physical store. PayTM and Freecharge are two companies that got famous for making mobile recharges online. They used to put cashback offers for each mobile recharge to gain the initial traction.
    Through the years, as internet got ubiquitous in India, PayTM and Freecharge gained more and more users. At the same time, they were offering more
    features and got accepted by few online merchants along the way.

  • As of now in 2019, PayTM website/app can be used for paying electricity bills, sending money to other PayTM users, buying physical gold, buying consumer goods and electronics, getting currency exchange, booking flight tickets, buying event tickets, donations to relief funds and other non-profits and more as seen from the website.

  • Many online and offline merchants accept PayTM. Freecharge has mostly online merchants.

  • As of Sep2018, PayTM has 9 million offline merchants accepting PayTM. This includes small shops on the road, coconut vendors, mom and pop stores, some supermarkets etc. Even Uber in India accepts PayTM.

Coconut vendor in Hyderabad, India accepting PayTM, PhonePe, Tez, BHIM below…
Not all coconut vendors in India might accept these, most merchants from metropolitan areas and cities might.

  • The wide spread usage of PayTM among small merchants has certainly to do with 2016 demonetization , PayTM campaigns as mentioned by @ankit and of course the cheap prices of affordable smart phones by end of 2016. It is also significant to mention the launch of Jio network in 2016 which made mobile data affordable for everyone with a smartphone in India.
    Quoting from Jio :

The company commercially launched its services on 5 September 2016. Within the first month, Jio announced that it had acquired 16 million subscribers. This is the fastest ramp-up by any mobile network operator anywhere in the world. Jio crossed 50 million subscriber mark in 83 days since its launch, subsequently crossing 100 million subscribers on 22 February 2017. By October 2017 it had about 130 million subscribers.

  • Major e-commerce websites in India (i.e) AmazonIN and Flipkart don’t accept PayTM though. Apart from Debit, Credit cards and online banking by banks, Flipkart accepts PhonePe UPI and PhonePe wallet. Amazon accepts BHIM UPI and Amazon Pay.

  • To sum it up, most offline vendors in India accept Paytm, Googlepay aka Tez, Phonepe. Online vendors might accept more digital wallets: Payzapp, Freecharge, Mobikwik, Amazon Pay

  • While it’s great to use the above digital wallet/s (or) payment interfaces and not carry cash physically around for anything, crypto would be great for better transparency of total money flow, micro transactions across borders as discussed above.(You can transfer 1 INR {1 INR = 0.014 USD as of today} to anyone through PayTM, not lesser though).

2. UAE : You have to physically carry cash/cards around. There is no such thing like the PayTM of UAE

AbuDhabi Emirate :

  • Debit cards and Credit cards are the standard modes of payments.
  • Small shops accept only physical cash.
  • Cabs accept only physical cash. Most cabs are available on the main roads in UAE and no need to book a cab through Uber or Careem on most times. It’s worth mentioning that mobile data costs are pretty high compared to India.

Dubai Emirate :

  • Debit cards and Credit cards are the standard modes of payments.
  • Small shops accept only physical cash. Few shops might accept NOL card, the same card you use for Metro, Bus, park entrances etc. You would still have to physically carry NOL card.
  • Cabs accept debit and credit cards


fascinating. Amazing to see that even street vendors accept PayTM. This makes me more optimistic that crypto can also be adopted for these types of use cases. Crypto payments would work well in local settings (e.g. street vendors) where fast and cheap peer-to-peer transfer is necessary. The main benefit I see over PayTM is that it could serve as a universal currency that is accepted no matter what country you go to. Imagine going from the US to Thailand to India to China, and having crypto accepted in all these places without ever having to do fiat currency exchanges?


Yes, street vendors would have a wallet address QR to receive money(just like PayTM’s QR code). Vendors who got used to PayTM, Tez etc might not even bother about the underlining technology as long as crypto is stable and if they can use it at most places(just like PayTM now).

  • Definitely agree on not having to go through currency exchanges while on multiple travels like you mentioned (or) even for remittances. Exchanges in the airport charge a lot as fee, more than exchanges in the city. So time spent before and during travels on converting from one fiat to another fiat is also saved(and of course extra fee). On the flip side, this is dependent on government regulations in various countries. It’s interesting how the sentiment about crypto might evolve from an arbitrary government’s perspective because the number of merchants(especially e-stores)accepting crypto might only increase.

I came across PayTM canada, and if it is going to be as widely accepted there as in India, may be people travelling from and to Canada need not use exchanges (or) carry lot of cash physically.(If PayTM can provide such feature!)


M-pesa in Kenya! I used to have a Kenyan sim card when I was there on jobs with Chevron and it’s how I paid for everything without having a Kenyan bank account.

The same thing is about to occur in Angola which is HUGE. Angola has an inflation rate more than 20% where most citizens are unbanked but have access to mobile devices.


Related : I came across Wave which is an application to send money(no fee transfer) from US, UK and canada to Africa(currently live in 5 countries). Looks like the recipients directly receive to their m-pesa wallet (for Kenya) as shown in the demo on home page. This is great for remittances especially if people don’t have wide access to banking.


The Fed’s working on faster payments! This article describes the U.S. as “scrambling to catch up” on similar government efforts around the world:

Numerous payments schemes have rolled out since the U.K. launched its own Faster Payments Service in 2008. Australia introduced its New Payments Platform (NPP) in February 2018, and Hong Kong’s Faster Payment System launched in November of that year. Demand for these services is high. NPP’s CEO, Adrian Lovney, told PYMNTS that nearly 1.5 millionAustralian consumers — more than 5 percent of the population — registered with the service within its first month.

The U.S. is still scrambling to catch up, however, and major financial players are hoping it can achieve its own ubiquitous real-time payments system by next year. The Federal Reserve’s Faster Payments Task Force established a goal in July 2017 that any consumer or business with a U.S. bank account would be able to securely receive real-time payments by 2020.

I was alerted to this story by Bill Gurley’s tweet:



Interesting. Do you think this falls under the “threat of Crypto” use case? If not, what’s the incentive to do this?


I’m not sure - I was hoping to get some input on that question myself by posting it here :slight_smile: They could be complimentary efforts.