NEW DELHI: With more than 95% cash transactions, it's a long way for India to be a less cash economy.Though this also presents an opportunity for new entrants to try out their products and services, which could boost digital payments. In an e-mail interaction, payment gateway services provider PayU India's CEO B. Amrish Rau discusses digital payments , why messaging and internet companies are getting into the space and more. Edited excerpts:The digital payments industry in India is expected to be $500 billion by 2020, according to a Google-BCG study. The government is committed to push digital payments and we can see that in the recent initiatives like demonetization, introduction of UPI, etc.The key opportunities I foresee areThe focus should and will be on making the transaction flow easier to understand for the middle-aged and not just millennials. According to the latest BCG report, rural India, home to about 870 million people, should be the prime target of fintech players creating awareness around digital transactions. Hence, I feel a UPI-like service will be a big focus in 2017.We should further anticipate an increase in the adoption of technologies and platforms which are incremental to banking services.A recent analysis by consultancy PwC suggests the expected Indian market size in lending through P2P (Peer-to-Peer) platforms alone will be $5 billion. There will be an opportunity to use the online digital payments channel to deliver credit and to ensure collection of payments also happens faster.The use of social media for commerce has been on the rise. FB and WhatsApp have been destinations for product promotions and commerce. Payments will need to follow.One of the most anticipated trends of 2017 is Bitcoin, both in terms of spending and investments. The industry is already witnessing a growing user acceptance with a rise of 250% in the Indian user base, further accentuated by surpassing the $1,000 mark, hitting its highest value post demonetisation. While still at a nascent stage in India, Bitcoin will observe major overhauls and industry-wide associations to gain mainstream acceptance and scope of utility.According to Reserve Bank of India data, since November 2016, the value of digital transactions has grown 18% while volume (number) of digital transactions grew by 28% at end of May. Digital payments have seen tremendous growth since demonetization. The ratio of cash usage versus card usage is 93:7. Out of the 7% of card transactions, 40% of all card based payments are online.Two years back almost 80% of e-commerce transactions were cash on delivery. Today, the scenario has changed and around half of e-commerce transactions are cash on delivery and rest through digital payments.Digital payments have always been the very core business of PayU India. PayU is broadly targeting three areas of growth - faster payments, consumer credit, and digital or app based banks (not payments bank). While Payments Gateway is our core business, PayU is also coming up with a UPI based app (Citrus Pay App) which is currently available in beta.Anyone who has followed the Indian middle class will agree that the credit model has been broken for the last 10 years. There will be an opportunity to use the online digital payments channel to deliver credit and to ensure that collection of payments also happen faster. On these lines, we recently launched 'LazyPay’ a buy now, pay later payments option to drive faster purchase experience for the consumers. LazyPay is a convenience product for anyone to pay later and the facility could extend for amount from ?3,000 and even up to ?10,000 depending on the profile of the customer.The trend worldwide is to enable faster payment platforms. Digital payments in India are still at a nascent stage and hence the opportunity to evolve faster payments is huge. All the players like Apple Pay, Samsung Pay, etc. are trying to solve this issue of driving faster payments. Whatsapp with 200 million users, hopefully should be able to evolve as a faster payments platform with UPI as the backbone.Indians already have a sense of convenience when it comes to WhatsApp as a messaging platform which makes it easier for them to use the same for digital payments as well.Social platforms enabling faster movement of money is a welcome sign. Payment transactions will happen on social channels and we will see more products with 'pay' buttons on SMS and WhatsApp. Tuition teachers, gym coaches, bloggers, cupcake bakers etc. will all use social media channels for receiving payments.