Space: The Bold New Frontier for Business

Space has always been the dark, mystifying void, familiar to the common man only through text books and documentaries. Practically, yet, ironically, space or the universe as a whole does not seem to affect the humble humans living on Earth. Its traverses are limited only to tabloids, scientists or the weekly documentary on the discovery channel. Until now, the space industry was mainly driven by the state funding to their respective national space agencies.

However, this arrangement is rapidly changing with the private sector taking a keen interest in space innovation (A déjà-vu moment for Sci-Fi buffs). But space is not your ordinary run-of-the-mill industry with initial investment and long term profits. Investment in space is a continual and painstakingly grueling process, with the silver lining of profits far away into the distant future.

The space shuttle program of the United States officially came to an end in 2011. This led to the United States having to rely on other space agencies and mediums to launch supplies in order to keep the International Space Station operational. However, this was still not feasible as the only other reliable country with an autonomous launch vehicle was Russia.

The gradual development of these events breathed fresh life into the Elon Musk founded company SpaceX. The company successfully test fired their rocket and launch vehicle systems in the presence of NASA scientists; thus, bagging a $1.5 billion contract for providing essential supplies to the space station for the next couple of years.  This was a huge achievement for the virtually unexplored industry and led to the opening of a new frontier for business.

According to 2013 estimates, the space innovation industry is currently valued at 315 billion dollars, consistently growing at around 4 percent per annum. The tremendous growth tasted by SpaceX has prompted entrepreneurs to latch on the early opportunity as the industry is expected to double in the next ten years; an opportunity that is too tempting to resist.

This newfound faith in exploring space has prompted entrepreneurs to engage in bold and what some may term as foolhardy measures to develop space technologies ranging from rockets and spaceships to asteroid miners, Moon Landers, interplanetary transport vehicles and zero gravity 3-D printers. This is not some stuff out of a science fiction novel; these are actual technologies being developed by the so-called next-gen start-ups.

This industry has another dimension; a more fun and luxurious dimension. Richard Branson founded Virgin Galactic and other small companies in the fray are offering trips to space to patrons. However, the ticket to space goes at $200,000 a pop. But, the company hopes to provide the ‘joy of space travel’ accessible to the common man in subsequent years.

The commercially successful industries here on Earth, are fueling the progress for space innovation. The glowing examples of this growth are companies like Boeing and SpaceX; whose successful business models are enabling the reallocation of resources. The common man may think that space exploration and travel is only a rich guy’s whim, but the same thing happened with the aviation industry, which was inappropriately disregarded as an extravagant dream of playboys.

India’s recent space missions to the Moon and Mars were not mainly in the spirit of science, but had an ulterior motive of emblazoning its low cost, yet, effective technology to the world. The growth of this industry will suffer form shortfalls unless newer and more efficient technologies can be developed. India’s move to showcase their low cost rocket technology will go further to bolster investment in India’s space program initiatives.

For now, the real business of space is just about promoting science and providing much needed ground support to keep the International Space Station operational. However, this is because the control of the industry is in a phase of transition from government hands to those of corporate. Once the base is ready, the private sector will look to fully exploit the opportunities that lay in space, encompassing the tertiary services right at home.

But, there have been recent setbacks to the industry, which have opened it up for debate, whether space companies will ever be able to bring home the bacon. Orbital Sciences’ Antares rocket, carrying cargo supplies for the space station exploded shortly after take-off. In another incident, Virgin Galactic’s SpaceShip Two crashed, killing its test pilot. Such setbacks are foreseeable, given the nature of danger that follows with the line of work. The advancements that will be made after such setbacks are much more important as they will be reminiscent of the growth and maturation which will take space innovation to its heights.

Private investment will keep on growing as the achievements and success of companies will invite more and more to join in on the space boom. The first space race ended with the end of the Cold War, but a whole new space age is taking shape right before our eyes. The coming years will be a testament to how well the industry is able to mature and grow from its infancy in achieving the visions of its pioneers. You may very well be enjoying a burger from McDonalds while sipping a hot latte at a vacation in space.

The Fading Sheen of SEZs in India

Globalization and massive Industrial growth gave rise to today’s Special Economic Zones or SEZs (as they are commonly known).  They were developed with a clear goal of providing tax incentives to huge Multi National Companies and to promote the inclusive and exclusive growth of the host country. The first SEZs were naturally set up in several East Asian countries which were looking towards rapid industrialization and growth.

The first one was set up at an Airport in Ireland, but the idea didn’t really pick speed until the 1980s, when the Chinese Dragon started scaling the economic ladder to high growth and industrialization. Through the 1990s and the early 2000s, the world saw a huge spurt in the number of SEZs. Even India got on the bandwagon and came up with the SEZ policy in 2000 looking to unleash a new 

chapter of industrial and manufacturing growth.

With that aim clear in mind, SEZs should have probably revolutionized the investment climate in any country willing to offer such incentives and infrastructure. Today, there are over 4000 SEZs across the globe, with a majority of them lying in developing countries (for obvious reasons).And new ones keep coming up or are in the planning process. But, despite these huge numbers, a majority of them haven’t been able to account for the kind of growth that they should have.

In India too, their performance has been dismal. There are around 580 SEZs approved by the government; but only around 200 are operational. That is a disheartening figure for a country which has recently launched campaigns like Make in India and is aiming at double digit growth rates within a decade.  One may think that 200 operational SEZs is a good number for India; however, out of those operational, the ones which are profitable are very few.

The real sheen behind an SEZ is the list of tax incentives and exemptions that the government is willing to offer, in return for the company’s investment and operations. However, as ambitious as Make in India sounds, it fails to perform on paper. As per the SEZ policy, companies were exempt from paying the Minimum Alternate Tax MAT) levied on book profits and the Dividend Distribution Tax (DDT). However, these tax lollies have been snatched away from the companies. In late 2014, the government announced an 18.5% MAT on book profits; a move which has been highly criticized by the commerce ministry.

It seems that the government wants to achieve its growth targets but, without letting go of its cash kitty. What the government needs to understand is that, if it does take away some of these tax benefits; it has to be ready with some other incentive which can compensate for it. However, there is complete deadlock in the further development of SEZs.

Like all Industrial zones, SEZs are also located outside the limits of cities and metropolitans. This arrangement requires setting up of minimum infrastructure in order to enable functionality. The infrastructure includes high quality roads fit for heavy machinery and equipment, a robust rail network, along with ports and airports.

But, all that is secondary to tax exemptions. Relief from unnecessary taxes is the primary driver that makes an SEZ attractive to multinational corporations. If that isn’t offered, the company may set up its business on a different piece of land, with better infrastructure and connectivity. The commerce industry was hoping that the budget would include such reliefs, but that didn’t happen.  The Prime Minister has made lavish boasts of how the government is cutting the red tape and improving the ease of doing business; however right now, these are nothing but big words with little backing. A recent report stated that developers have pulled back from 61 approved SEZ projects in Maharashtra.

From the look of it, it may seem that the government has given up on the SEZ dream; but it isn’t so. The story of Sanand district in Gujrat is a major driver towards this cause. Sanand is rapidly on its way to becoming the automobile hub of India; and has also been flamboyantly referred to as the next Detroit in making. The portfolio of high profile manufacturers includes TATA Motors, Ford, Hitachi, Citroen and Cadila Healthcare.

This is truly a welcoming step, but such moves should not be limited to certain districts of the country. The incentives being offered there should be generalized to other industrial hubs of the country as well. Instead of spending money on opening of new SEZs, the funds should be diverted towards infrastructure development.

It isn’t too late for India to unleash its growth potential. But, retrospective taxation will take the investment climate to its doom. For SEZs and the industries to flourish, the government has to let go of its control and provide multinationals with opportunity on a silver plate. Basic Infrastructure facilities like Electricity, connectivity with railways, ports and airports should be developed to end negative sentiment towards SEZs in India. 

The Indian Startup Bandwagon

According to a recent report by NASSCOM, the IT-BPO industry body, the last fiscal year saw 800 startups enter the Indian market ecosystem. Riding on the wave of globalization and opened market access, several trained professionals are going the entrepreneurial way. As per NASSCOM’s report, according to the current growth patterns, India will house the second largest startup ecosystem after the US, in the next two years.

For a few years now, India has chosen to silently ignore the immense potential that the mushrooming startups hold for the economy. But, all of that is changing now. The Union Budget 2015 has acted as the first step by the Indian government to acknowledge this new segment of the market, by creating a special mechanism called SETU-Self Employment and Talent Utilization.

This mechanism is meant to support and nurture the startup ecosystem in India. But, it is still a very small step, given the size of the startup market and its current growth trajectory. The biggest driver of growth in the startup scene is e-commerce. 2014 was the year, when the average Indian consumer was exposed to a new frontier of shopping.  

However, the story of startups is not as rosy as it is portrayed. A startup is like any other company and requires investment and funds to function; especially in the garage phase of its existence. The US has a highly evolved and nurturing ecosystem for startups in the form of incubators and angel investors. On the other hand, India currently has just 80 angels and incubators combined. It is quite apparent that the startup to incubator ratio is dangerously low in our country.

Unlike home businesses, startups cannot run on family money for long. The Union Budget has allocated a thousand crore rupees for the promotion of startups, but, it is still meager compared to the requirement.

Some of the startups which have served as the flag bearers of the startup growth story are companies like Snapdeal, Ola cabs, CarTrade, PolicyBazar, etc. these companies have come a long way to become successful startups that offer unique services to the consumers. The rapid growth of these firms has been the driver for other entrepreneurs to dream big.

The startup ecosystem is thus divided among two categories- the haves and the have nots.  On one hand, there are successful startups like Flipkart, Snapdeal, and Ola which are managing to score multiple rounds of multi-million dollar infusions; while on the other hand there are others who are facing situations similar to a famine.

Also, the most notable startups that have sprung up and are successfully running their businesses are limited to the fields of Mobile and E-commerce. One may think that this is the case because of the immense strides going on in this sector, but that is not entirely true. The fact to blame here is that Indian startups are being funded by foreign VCs, who are currently fixated at expansions in the technology sector.

Such a scenario is very disheartening for the hard working entrepreneur, with brilliant ideas and innovations, but, no recognition and support.  SETU is a positive approach out of this mess. However, it is still a pebble in a pond.

While the government goes on calling to foreign conglomerates to Make in India, their first step should rather have been to promote an internal growth ecosystem. The number of new startups is going to keep on growing, as young graduates and professionals ride the entrepreneurial wave to self employment. So, instead of creating new sets of regulations to bog them down, the GoI should instead create support groups and organizations which identify and aid potentially unique and valuable startups.

The road ahead is quite long for Indian startups. The coming year will see many more startups mushrooming all over the country, with new and unique products and enthusiastic entrepreneurs at their helm to guide them to glory. Several more steps are also expected from the government which will help reduce the turbulent divide between the top 5 percent of startups and the rest of the 95 percent. 

Toll Booths on the Internet: The Case for Network Neutrality

The internet today is an embodiment of the democratic world that we live in. it was founded on the principle of equal access for all. This meant that each and every person would be able to access the immense streams of data that abundantly fill up the far reaches of the internet; a principle that has struggled to stand firm over the years.

Throughout history, telecoms have endeavored to block the free movement of communication across diverse landscapes. They have used every play in their book to ensure that the costs of communication remain high for the end users. But, the close eye of the governments prevented them from having their way.

Ever since the internet went mainstream, the telecoms could see their grip over the telecommunication market loosen. Technology had found a way through their oppressive tactics. Today, the internet has arrived at a juncture, where it is capable of becoming the sole carrier of all kinds of data and communication.  Such a scenario is unprecedented.

The hyperactivity of the internet has attracted the sharks. The telecom companies can see their control deteriorating. The cost of communication has halved for the end user because of decreased dependency on carrier calling and messaging services. The self sufficiency of the internet is highly hostile to the telecom carriers.

This is where the case for Net Neutrality comes in. The carriers are no longer able to generate demand for the calling and messaging services. And they cannot simply justify a hike in prices of internet services.  So, instead, they are taking the hostile route.

The term network neutrality was coined almost ten years ago by Tim Wu of the Columbia Law School. It highlights the gargantuan success of the internet and how its providers are trying to control the transmission of data packets across its lengths. 

The protocols of the internet were clearly defined to allow free transmission of data without any bias or discrimination. However, the network operators have now found a chink in this armor. New technologies have now enabled network operators to easily identify and at the same time, intercept the kind of traffic that is being transmitted.

This technology, which was originally intended to filter SPAM and phishing data, is now being used by operators to put up toll booths on the internet.  In order to keep their revenue up, telecoms intend to use these barriers to unleash so called ‘premium’ services.

Their idea is to sell premium access to consumers for services being hailed as ‘fast lanes’ (bandwidth hungry services like videos, gaming, etc.). So, if one is a regular user, then he will be forced to use the slower road to his destination; unless, of course, he is willing to pay a premium to avail the benefits of the metaphorical highway of bandwidth.

And this problem is not just limited to the West. In December 2014, Airtel tried to bring this dirty game to India too. They tried to make internet calling or VoIP a paid service for all its users. The carrier would be able to differentially charge customers for using these services.  This move was met with a huge opposition and caused quite a furore across the country. Thankfully, the company did not go forward with their plans due to such widespread opposition.

But, the disturbing news is that, the war against Net Neutrality has managed to arrive in India too. Internet activists the world over are up in arms to oppose such moves and to ensure that the internet is not tied down. The only way that this can be prevented is by setting up network neutrality rules that prevent network operators from fragmenting the internet.

The United States and the European Union are working together to create a set of guidelines and rules which will govern net neutrality. The Netherlands has already passed strict network-neutrality laws, after its national telecoms company threatened to levy additional charges on internet calling services.

India has one of the slowest broadband infrastructures all over the world. Along with that, internet penetration is mostly limited to urban and semi urban areas. Although access to fast internet services has been recognized as a necessity in today’s world; it remains a luxury in our country.

The Airtel incident went without any comment from the Indian telecom regulator TRAI. The matter has subsided for now, but, in all possibility, some other carrier might try to make a similar move. Currently, the Indian telecom laws are quite liberal and do not stop the operators from attempting to introduce differential pricing for their internet services.

Several organizations have sprung up to defend the rights of consumers and to ensure that each and everyone have equal access to the internet. The internet is defining tool that reflects the liberal and secular times that we live in. to take that away, is like taking away the sovereignty of the people and their voices. Barack Obama is a staunch proponent o the cause and last year launched a dedicated website for people to track the developments. The Federal Communications Commission is working with governments all over the world to prevent the free reign of telecoms. 

The internet is a catalyst of all modern innovations and thus, to safeguard the interests of the consumers and the constitutional foundations of the country, the Indian government should also become a part of the process of framing stringent network neutrality rules.  Right now, it is very difficult to say how these rules would hold against the attacks of its opponents.  The only thing that’s important is to ensure that network neutrality does not become another notion, forever stuck in legal tussles; for the sake of democracy and free access to information. 

PayTM arrives at the E-commerce Party in India

2014 was the year of e commerce in India. The budding online retail industry was able to rake in a whopping `1 trillion in online sales. This approximately translates to around $16 Billion; a growth of $4 billion from 2013. The forecast for 2015 is even better, with the Indian e commerce industry expected to double its performance over the previous year.

The proof of this fact is the entry of several new players in the e-commerce ecosystem. But, the e commerce market relies on continuous external funding to remain successful. And not all the companies are lucky to be able to receive such funding. This is where the story of Paytm comes in.

Paytm started off as an online payments gateway or facilitator; somewhat similar to the globally successful PayPal in the United States. If you make your payments online frequently, you may be aware of the company.  It provides payment gateways for companies like Expedia, apartment rental site Airbnb and app based cab company Uber. 

In 2014, they very quietly started up an online market place too, which was directly accessible from their app. That’s surprising. How does a mobile wallet company enter into the e- commerce market all of a sudden? But what’s more surprising is the fact that they did not sound the war bugles when they did so.

The e-commerce market thrives and survives on constant media advertising. So, what kind of an e-commerce company doesn’t publicize their foray into the market? The answer is- A Very Smart one. Paytm knew that it wasn’t big enough to grab attention so early. The company already had a registered base of around 20 million customers. Those are more than enough to get them started. And their primary business model of mobile payments would enable them to get a hang of the new business.

It was a smart move. But, the company could not afford to keep following this model for long. They knew that they would have to rely on external funding sooner or later. Unless they did so, they would burn out of the resources they were transferring from their payment gateway business.

And luckily, they managed to do exactly that. With the New Year, the company is now gearing up for its first funding round. And that round also brings in China’s Internet giant Alibaba.

Alibaba itself had a roller coaster year in 2014, when the company’s first IPO in the United States, turned out to be the biggest IPO in history, bringing in $25 billion dollars. Its online marketplace currently sells over a billion products. Needless to say, it’s the largest e-commerce company in Asia.

The big news here is not that Paytm managed to get a good amount of funding for its e commerce business. The takeaway here is that the biggest e commerce company in Asia has stepped foot into India. And that is just about to heat up the market to a whole new level.

For starters, Alibaba will invest $575 million in Paytm. But, eventually it is expected to own a 30 to 40% stake in the Noida based company.  But, the benefits of this deal for Paytm do not simply extend to the e commerce business. The investment has been made by the payment gateway arm of Alibaba, called Alipay. So, the company will also get access to Alibaba’s payment technologies. That is quite an achievement for the company, and also, a win-win situation.

However, for Paytm, the journey has just begun. They will be facing an uphill task here on. Bigger sharks like Amazon, Flipkart and Snapdeal have already matured to some extent in 2014. So, business will be challenging for the company. And the first thing they will be focusing on is creating brand differentiation.

The existing e commerce players in India have surely tasted success, but, their business cycles are far from perfect. The biggest hurdle that they face in India is providing low cost and efficient delivery to a humongous market.  The gaping hole in their logistics channels is a serious problem. 

The question that arises is, when the big players themselves are struggling to make deliveries on time, how will Paytm be able to manage its delivery channels. To get out of this mess, these companies will be focusing on forging contracts and business relationships with their delivery channels, in order to expect preference and priority over other players.

The year 2015 will not just be about which company provides the biggest discounts. Rather, it will be focused on providing greater customer satisfaction, through faster delivery, effective customer support and other benefits.

The employment of this strategy will ensure that customers let go on their hunger of discounts and cheaper than physical market products; and instead focus on better overall satisfaction in the process of delivery of services.

The entry of Paytm has just strengthened the fact that the e commerce industry in India has still a lot of space for new entrants; and the year 2015 will be a projection of that belief. So, hold on to your seats, as the game is about to intensify, and it will be fun to watch, what this year bodes for the industry as a whole.

The Perils of Airline Investing: The Spicejet Crisis

When the Wright brothers came up with the idea of a machine that could fly, they were brandished as the buffoons of the century. And naturally, their idea found no traction with the investors (read: wealthy people of the 20^th century). But, that was indeed the 20^th century, where anyone with a revolutionary idea was effectively termed a lunatic.

But, a hundred years later, things are quite the opposite. As the trend goes, the more ridiculous the idea, the more backing it gets from modern day investors. The latest being Elon Musk’s ridiculous (or not) idea of high speed travel, or in the words of the famous Science Fiction writer Jules Verne; Teleportation.

So, the bottom line is that the 21^st Century is a boon for companies looking for investors. But, then there is this one industry that is the investor’s nightmare; the dreaded Airline industry. While the industry has come a long way from the era of the Wright brothers, yet, it stumps even the most seasoned investors.

It remains till date a most volatile market to be invested in. And the recent Spicejet crisis is just another chapter in this book. A company, which upon its inception shaped out to be the game changer in the domestic airline industry in India, was seen crumbling like a set of dominoes.

And the problem does not lie with the market. The India Civil Aviation Industry comes among the top 10 biggest aviation markets.  It carries around 150 million passengers on a daily basis; and this number is expected to increase to 450 million by 2020. It has been repeatedly established that this sector has a huge latent demand, just waiting to be tapped into. With new companies joining the airline bandwagon each year (the latest being Air Asia and TATA’s Vistara), the sector should be going through immense growth, right? Not really.

While the sector is growing rapidly, it’s mainly because of the growing demand for air travel; due to economic development and increase in the disposable income of the people. In most cases, the companies drive the industry towards growth. But, in terms of this particular industry, the companies are acting as dead weight.

As soon as it gains normalcy and stability, a huge setback is dealt. Spicejet was considered a pioneer in the sector of budget air travel, but the recent blow to the company has knocked it out of the race for some time. And Jet Airways and Indigo are going to be the biggest gainers in this mess.

The root of Spicejet’s downfall lies at its overzealous pricing strategies. In order, to win over market share, it offered heavy discounts on its tickets, the year round.  It offered tickets at over 15% lesser than other airlines. The logic behind the company’s decision was sound. The surge in demand should have factored for the discounts. But, it didn’t.  And what started as a marketing strategy, turned into an organizational blunder.

Somewhere down the line, the company became obsessed with the idea of increasing demand, figuring that it was bound to rise eventually. But, the intense competition from Indigo and Jet prevented that from happening. It’s almost as if the entire finance department of the company went into a slumber while the marketing department was out playing.

And apart from the company, the biggest losers in this mess were the investors. This debacle hit like a blow out of the blue. The shares of the company had got a big boost last month when billionaire investor Rakesh Jhunjhunwala purchased 7.5 million shares in the company, leading to huge market gains for the investors as the stock price soared.

A growing stock price, big investments are all favorable trading signs for investors. But, when the company hit the emergency button this month, it was pandemonium all over. The market share of Spicejet fell by around 17 per cent. The market cap of the company fell by around 400 crore rupees.  According to company estimates, it needs an infusion of around 1800 to 2000 crores to regain stability. For now, the situation seems to have calmed down with help from the government and the company’s promoter Mr. Ajay Singh, who is being hailed as the Knight in shining armor for the company.

Coming back to the issue, it really is quite evident now that the whole sector is highly volatile; like a nuclear reactor just waiting to melt down.  There are quite a few factors that contribute to this volatility; intense competition, fluctuating variable costs, which include unprecedented changes in the prices of aviation fuel, etc.

Apart from the above factors, several other factors include poor corporate governance, messy financial reports and lack of investor insight. It’s a very difficult market to invest into and many have had their fingers burned.  It is very difficult to judge when the yields of the airline might be in the red.

So, if you were planning to invest in some airline, be cautious. Many finance pundits have already marked it as a ‘NO-NO’ if you are looking for personal investing. Leave this industry to the big guns. Or if you do like to be the daredevil, do not dare to even blink; because you never know when the tide might turn.

Is The World Moving towards a Cashless Society?

Fun Fact: The earliest origins of money can be traced as far back as 9000BC, where grains were generally used as a form of money for exchange of goods.  Later came gold coins, then copper coins and now, here we are at paper notes.  The one notable change that can be seen here is the fact that the tangibility of money is slowly decreasing over the years.

Hear me out; the first official modes of currency were coins made of precious metals. This went on for some centuries, when suddenly, it was shifted to lesser materials like copper or bronze and even silver.  Then, in a sort of a new age revolution, paper currency notes were brought into use by the Europeans in the 17^th century (Another Fun Fact: The Chinese were the actual inventors of paper currency and were using it for more than 500 years before the Europeans).

 

The ancient form of money- copper and bronze coins

So, it’s been another 400 years or so, since paper currency is being used as a prominent method of exchange of goods (read: transaction). But, if you look closely at the trend in the market, the signs of its demise are pretty evident. As we rapidly move into a digital society, paper currency is bound to die.

Money was first truly digitized with the introduction of credit cards in America in the 1970s. Before that, a stable financial credit system run by a third party (in this case a bank), which was accepted by most of the merchants did not exist. And thus emerged, Visa and Master Card and other players of digital money.

Various plastic money vendors

Like every new innovation, it took its time to become popular, but now, here we are, using cashless money with great ease in our daily lives. So much so, that without our realization, paper currency is slowly dying. With the Reserve Bank looking to standardize plastic currency after a short trial in a few states, it seems the end is near.

But, India and even many developed countries have a long way to go towards the path of a cashless world. In fact, Sweden has come out as the country that is the closest to a cashless society. On an average, every single person in Sweden makes almost 260 transactions using their credit and debit cards per year.

An army of credit and debit cards are on offer from almost every bank

The reason behind this shift in mode of ‘preferable’ form of currency is the strong force by which technology is shaping and evolving our world. Cashless transactions are not only more flexible, but, surprisingly, more secure too. Unified shopping markets like supermarkets and hypermarts are only fueling this process.  Almost anywhere you go, you’ll find a card machine just waiting for your card to get swiped. And even the financial market is promoting their use, for the simple fact that they are comparatively much easier to process and handle, than traditional currency.

Online transactions have further reduced the physical footprint of currency. The physical swiping of the card has also been nullified, with secure alpha-numerical passcodes being used to safeguard your transactions.

Apple Pay and Google Wallet

So, this is where the next big leap in money transactions comes into the picture. It’s a universal fact now that mobile technology is a powerful force and almost all digital traffic is currently hogged by it. So, the whole premise here is that over the past year Apple and Google introduced a new revolutionary way of making transactions (As if cashless online payments weren't revolutionary enough).

So, almost every decent smartphone in the market has an NFC (Near Field Communication) chip built into them today. But, for the average consumer, until now, it was just useless gimmick.  But, as it turns out, these mammoth of companies, do think ahead. So, they have developed a new method of wirelessly making transactions using your mobile phones; even the manual typing of passcodes has been slashed.

Wireless transaction through Apple Pay

The smartphone in your hand will smartly enough, store all your collection of plastic money (read: credit &debit cards) in a single, “secure” place on your phone. And with that, you can wirelessly make payments by just hovering your device just near the payment machine, with a single tap.

Wow! Right? Not exactly. What’s skeptical here is the fact that mobile technology (as wonderful as it is) is still flawed; and not too secure either, as evident from various hacking scandals that come up from time to time.  So, would you trust your mobile manufacturer with all your accumulated wealth? That is the biggest question that remains unanswered.

While these companies do promise complete privacy and many other complex innovations that are supposed to keep our transactions safe or in other words crime free. But, that can only be ascertained, when we actually see this technology in action.

We are still too early in the game and surely, THIS IS THE FUTURE.  But, the present? I really don’t think so.  But, this much is clear that we are hurtling towards a cashless society. The next time you go shopping or buy something, notice the change, and you’ll know what I mean.