Healthcare Wallet will Emerge!

 

Healthcare Wallet will Emerge!

India is poised for 10 fold increase in digital payments. Will become 4th largest in the world after Singapore, Sweden and USA. This will have a profound impact on Digital Health. Will become a major driver in adoption of Digital Health across payer and provider systems.

Consider This:

Health Insurance coverage has gone up from 3% of Indias population to over 40% with Ayushman Bharat.

90% of Health Insurance claims is reimbursement of out of pocket out patient expenses related to the inpatients episode.

Insurance is more comfortable reimbursing a Digital expense because it reduces the chances of fraud and abuse. From a Actuarial perspective the risk comes down because of full traceability.

Patients will gravitate toward clinics and hospitals that provide Referrals, Prescriptions, Reports in Standards based electronic format. Because Insurance companies will clear the standard eClaims format faster.

About 8% of out patient gets converted to inpatient procedures for any hospital OPD. Any reduction in out patient foot fall will negatively impact the inpatient load and hence the top line.

A Fintech based rating engine will appear to rate the clinics and hospitals. This rating engine will be far more pervasive than the Practo rating engine because money in the pocket is always a more powerful driver.

A whole new sand box gets created for the digital health startups, software vendors and fintech companies to play. Someone will fill the vacuum. For lack of a better word a Paytm or Jio Wallet for Healthcare expenses and reimbursements is on the anvil.

India will be the next battleground for Global Retail and Healthcare! After USA, India has the largest user base for the Internet Giants like FB and Google. Amazon is in India. Walmart is picking up majority stake in Flipkart. All the Internet and Retail giants have expressed interest in Healthcare.

Can you extrapolate the Dots? I can see the Trend! Fintech fueled transformations are underway.

The real innovation in mobile payments in India began a few months prior to the cash ban. It’s called a unified payment interface, or UPI.

With more than 140 Indian banks sharing the interface, and Alphabet Inc.’s Google and Facebook Inc.’s WhatsApp offering instantaneous payment services on it, UPI has become a keenly watched experiment. By the looks of it, things are going well: From nothing to 800 million monthly transactions in less than three years, India’s UPI has taken off. Growing smartphone use and crashing data costs have helped immensely.

Google and WhatsApp will fight for market share. So will PhonePe, now owned by Walmart Inc. as well as new entrant Amazon Pay, which hasn’t made much of a dent globally into PayPal’s dominance of e-commerce. Indian banks that run their own UPI services. Indian tycoon Mukesh Ambani’s Jio with its 300 million subscribers will push JioMoney. Masayoshi Son and Warren Buffett will keep an eye on their Paytm stakes.

Now RBI has removed charges on RTGS/NEFT transactions; and asked banks to pass on benefits.

Cities Perspective:

Tier 1 cities: Pune, Bengaluru, Chennai are leading the wave in UPI transactions. Pune topped the city list, with the highest average digital spend — per person per month — of ₹16,513. Followed by Chennai at ₹14,208 and Bengaluru at ₹14,000.

Tier II and III Cities: Razorpay says by 2020, 40 per cent of digital payment transactions in the country will be driven by businesses and consumers in Tier-II and -III cities, and 50 per cent of internet users will be using digital payments. Whereas Paytem says - We have been witnessing a tremendous increase in adoption of digital payments in tier II & tier III cities that constitute 50% of our total user base. Surat, Durgapur, Rajkot, Meerut, Imphal, Rohtak, Panipat, Mangalore, Ranchi, Puducherry, Rajamundri, Warangal, Jodhpur, Thrissur, Karnal, Madurai and Jamnagar are among the fastest adopters and are leading the wave of digital payments adoption.

Users of wallets are not updating their KYC (know your customer) details. Instead, they are using UPI (Unified Payment Interface) to make digital payments. Anyhow total payments via digital instruments are expected to be between $400-500 billion in 2020, up from $50 billion in 2017.

Hold your breath guys! Fintech is the digital health roller coasters.

India will be the next battleground for Global Retail and Healthcare!

India had 60 million online shoppers in 2016, which is only 14% of the internet user base in the country. This will rise to over 50% by 2026, according to a report by Morgan Stanley.
On top of that India has over 900+M mobile phones. 60% of these are smart phones. 90% of these are Android phones. 200M Jan Dhan Accounts have been opened at the bottom of the pyramid. Digital transactions have crossed 1 Billion every month. Rupay has emerged as the largest payment gateway in India dislodging Visa and Mastercard. Electricity has reached 500K villages. All this is expected to fuel the organized retail market.

Online retail is fast catching on, not just in the larger metros but also in the Tier II and Tier III cities. This growth can be attributed to increasing internet penetration and smartphone revolution. The Indian retail industry has come of age and has emerged as one of the most dynamic industries in the world. Accounting for over 10 per cent of the country's Gross Domestic Product (GDP) and approximately 8 per cent of the employment, it is expected to nearly double to $1 trillion by 2020 from $600 billion in 2017, registering a Compound Annual Growth Rate (CAGR) of 16.7 per cent over 2018-2020. Keeping in mind the growing online potential, brands and retail chains alike are upgrading their online presence to draw customers to their e-shops. India's growing per capita income, a rising middle class, changing demographic profile, urbanization, and attitudinal shifts in the consumer spending pattern, all indicate the retail sector's potential to be the real growth engine of the country's economy.
NHPM or Ayushman Bharat has created a huge Healthcare market i.e. INR 500K cover per family for 100 Million families in India. This is a game changer and all big players will run after it. Drugs form approximately 70% cost of any treatment. Obviously this Coverage needs an e-commerce platform, telemedicine apps, and digital community to support the physical Healthcare Ecosystem.

Myntra, Online retail store for fashion and lifestyle products, acquires smart wearables devices startup WitWorks. Flipkart owns India’s largest online fashion retailers -- Myntra and Jabong -- both of which it acquired. Together, Flipkart-Myntra-Jabong has a 70 percent market share of the online fashion business in India. It also owns eBay’s India business as well as popular mobile payments app, PhonePe. With over 100 million users and these popular properties, Flipkart is a valuable asset in the global internet economy for its long-term potential. Walmart is now looking to pick up majority stake in Flipkart. Walmart may rope in Alphabet [Google] also for Flipkart.

Amazon is already in India Retail sector. Amazon is already selling its services to many in Healthcare and has also announced it's desire to do more in Healthcare markets in US. Amazon said that it is working with Berkshire Hathaway (BRKA) and JPMorgan Chase (JPM) to better control costs and reduce spending on the health insurance they offer for the 840,000 people who work for them. Amazon has invested $4.74 billion in Amazon.in, to go after the India market and compete with Flipkart, Myntra, Jabong.

For traditional physical world Retailers, this means entering the playing field with the likes of e-commerce behemoths Amazon and Alibaba, both of which are leveraging big data and powerful AI algorithms to transform the retail space. The traditional Retailer Shopping giants are feeling the heat from Flipkart and Amazon in India.

Cooper Smith, who advises retail clients with Galloway's firm, L2, thinks we may be years away from a serious discussion on breaking up Amazon, but he advises retailers to not sit around and wait for that to happen. He thinks the announcement that Wal-Mart is partnering to sell some of its products on Google Home is significant for struggling retail survivors: "A lot of luxury brands like LVMH, which has refused to touch Amazon with a 10-foot pole, are talking about banding together to create a new luxury e-commerce space. Amazon hasn't been able to disrupt that market yet. Google and Facebook are the platforms with the reach, those are the alternative platforms that would help brands and retailers reach consumers without having to partner with Amazon."

In the US, Wal-Mart shoppers can link their Wal-Mart accounts to Google Express and quickly order — either through voice on Google Home or by shopping on Google Express. By linking a shopper's past Wal-Mart purchase history, Google will be able to more quickly learn the customer's shopping patterns and recommend suitable products. Using the platform now, a customer can say, "Google, buy peanut butter." Google will then suggest the brand it thinks the customer would like the most. The same can be leveraged by many other smaller struggling Retailers in India to compete with likes of Amazon and Alibaba.
On top of that Google is betting that the future of healthcare is going to be structured data and AI. The company is applying AI to disease detection, new data infrastructure, and potentially insurance.

FinTech mobile based payments developments supported by Govt of India's Digital India, Jandhan/Aadhaar/Mobile and BHIM App are only adding to the fire. Many local startups like Paytm and All big Internet and Retail giants are jumping into the ring - Flipkart, WhatsApp, Samsung, Android...

After USA, India has the largest user base for these Internet Giants. Obviously India is fast becoming the next battleground for Retail and Healthcare?

Can you extrapolate the Dots? I can see the Trend!

#India #Retail #Healthcare #NHPS #AyushmanBharat #Amazon #Flipkart #Walmart #Alibaba #Digital #e-commerce