reluctant gourmet Food

Eating out? Leave your cash at home

Suddenly, the air was rent with the sound of beeping phones. I was catching up with an old friend at a cafe when demonetisation struck. Wondering what was going on, as everyone around us started frantically scrolling through messages and making calls, we glanced at our cellphones.

I had about 300 WhatsApp messages, courtesy feverishly buzzing group chats, all discussing the Prime Minister’s announcement that notes in denominations of Rs. 500 and Rs. 1,000 were illegal from midnight. Checking our watches, we shrugged and continued to chat — midnight was hours away.

I called for the bill an hour later and paid in crisp notes of Rs. 1,000. The waiter shrugged and handed it back. That’s when it began to sink in.

Over the past week, as people scrambled to interpret the move, between queueing up at ATMs, applying for credit cards and learning how to use mobile wallets, there has been a definite shift in consumer patterns.

Not to mention a spurt of stories about ingenious vendors, like the ‘digital chaiwalla’ in Delhi now accepting online payments for seven-rupee bills, and vegetable sellers in Chennai’s Koyambedu market using card swipe machines.

Since the now-illegal notes form about 86 per cent of the currency in circulation, and it is challenging to get change for the new Rs. 2,000 notes, restaurants are seeing a drastic shift to online payment.

In the three days after the announcement, a wave of panic swept through the country. “People just don’t want to eat out now,” wailed a restaurateur in Kolkata, lamenting a 50 per cent drop in sales. However, the story is not quite that simple. Chai shops, hawkers and roadside restaurants actually saw a smaller dip. At a packed tea shop in Chennai the next day, the busy proprietor shrugged as he continued to accept old notes. “I have to be practical to survive,” he said, adding that there had been a dip of about 10 per cent in sales.

At the popular 100-year-old Udipi restaurant Mathsya, however, where the average bill is about Rs. 150 for one person, the announcement had immediate consequences. “It was as though I had a ‘Closed’ sign on my door the next day. We were empty,” says proprietor Ram Bhat, over filter coffee and podi dosas. It’s lunch time and the normally packed restaurant is unusually quiet, even though it’s been a week since the move.

“It doesn’t hurt the five-star hotels and high-end restaurants, where customers have credit cards. It’s the mid-segment that got stuck. We took the hit. Business dropped by 50 per cent for the next three days.” It would have been more, if not for the fact that the restaurant started a tab for regulars. “We just said, ‘It’s okay. Pay us later.’ If I have a guy who’s been eating here for 20 years, how can I turn him away?”

Bhat says about 65 per cent of their sales used to be in cash. Now it’s the other way round. “We used to have a minimum limit of Rs. 300 to swipe. We made it Rs. 150. Now we say, ‘Swipe anything. Just pay us’,” laughs Bhat. “We are delivering even small amounts. We are offering a 10 per cent discount on our website... We have to do all this to survive.”

He adds that buying provisions has become more expensive too. “I go to Koyambedu market once a week to buy vegetables. But, with this scarcity of cash, that’s hard now. So, we are paying all vendors with cheques: it is about 20 per cent more expensive.”

He’s optimistic about the move, though. “Money goes straight from your card to the bank. It’s easier for us to handle less cash: less pilferage, not to mention far fewer trips to the bank for deposits!”

In the meantime, it’s been a good week for food apps and mobile wallets. Paytm, India’s largest mobile payments company and an e-commerce platform, claims to have touched a record five million transactions a day post demonetisation.

Commenting on the surge and what it means for the restaurant business, Deepak Abbot, Sr. Vice President — Paytm, says, “While quick-service restaurants registered a 3X increase in transactions with Paytm, the online food ordering segment grew by over 2X across the country.”

Zomato is aggressively pushing services with mass mails suggesting you “ditch the long ATM queues and go cashless to beat hunger” by ordering food and paying them online. To sweeten the deal, they’re offering 20 per cent off on these orders. The promo code? ‘NOCASH’.

Srivats TS, Vice-President (Marketing) of Swiggy, which now has a network of 9,000 restaurants across seven cities, says there have been a lot more transactions over the last week.

“We have seen a strong shift: users are moving to netbanking, credit cards and Paytm wallets.” He cautiously suggests that there has been a growth in users, adding that it’s still too early to pick definite trends.

“However, I do think there will be a lot of users moving away from cash long-term, now that they have seen the convenience of online payment.”

Chetan Rampal, hospitality operations expert and partner at a string of popular restaurants across Delhi, Kolkata, Mumbai and Bangalore (including Toast & Tonic, Monkey Bar and The Fatty Bao), states that this move is good for the industry.

“It creates a level playing field for those who play by the rules. Getting paid in cash means people can play around with it. With plastic you can’t do anything — it is registered, and you have to do it by the book. Everything works though the system.”

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Printable version | Oct 16, 2021 3:21:13 AM |

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