OMCS told to go 100% digital on LPG payments
To affect 80 million consumers, majority of whom are not used to e-transactions
The Union government has asked oil marketing companies (OMCS) to go for 100 per cent digitalisation on payments for liquefied petroleum gas (LPG) by March 2021. Hindustan Petroleum Corporation (HPCL) has taken the lead in ramping up its digital drive.
Though a step towards Digital India, the move is likely to have an impact on more than 80.3 million Pradhan Mantri Ujjwala Yojana (PMUY) consumers, a majority of whom are not exposed to digital transactions. According to multiple sources, among the three OMCS — Indian Oil Corporation (Indian Oil), Bharat Petroleum Corporation (BPCL) and HPCL — has already initiated steps towards achieving this target by “asking distributors for compulsory digital transactions.”
“Though 100 per cent seems unrealistic, companies aim to touch around 60-70 per cent,” said a top official from an OMC.
“The government has directed us to do it in a phased manner from June. At present, digital payment for cooking gas is around 18-21 per cent. We have asked the distributors to increase it to 25 per cent with immediate effect and then a phasewise increase to 100 per cent by March 2021,” said a senior official from an OMC. The three OMCS together have 278.7 million LPG customers, being served by 24,670 distributors.
“There is a revised target for cashless/digital payments for LPG refill delivery. Hence, your revised target of cashless/digital transaction is 100 per cent for FY21. Currently, this month’s target is 25 per cent,” HPCL said to its distributors.
HPCL has a total of 7.7 million LPG consumers, while Indianoil has 13.1 million and BPCL 7.1 million as of April, according to data available with the Petroleum Planning and Analysis Cell.
“Cashless payments are safe, convenient and transparent.
During the current pandemic, it solves problems associated with carrying and exchanging currency, which passes through multiple unknown hands. Even for digital transactions, contactless devices and methods are being encouraged,” HPCL said in response to Business Standard queries. Neither the petroleum ministry, nor IOC or BPCL responded to questions.
“HPCL has always been at the forefront of adopting new technologies to improve customer experience. The cashless payment methods were included at our retail outlets and LPG refill, many years ago. In the current situation, HPCL is proactively providing solutions, creating awareness and encouraging customers to use cashless mode of payments for LPG refills and at retail outlets,” HPCL added.
State-run OMCS sold nearly 23.1 million tonnes of packed domestic LPG during 2019–20 and 16.1 million new domestic customers were enrolled too.
When asked how distributors are adopting to the new directive, Pawan Soni, general secretary, Federation of LPG Distributors of India, said, “Conversion from cash to digital/cashless payment mode will require a major behavioral change in the age-old habits of customers.
Things like customer awareness, ease of making digital/cashless payments, incentive schemes for both customers and delivery personals and innovative ideas like pre-delivery digital payments will play a key role in encouraging contactless digital payments.”
HPCL dealers, however, are under greater pressure. “We are under pressure to accept digital payments and our agency has reached the 91 per cent-mark.
Customers in a small city like ours are using online mediums like Googlepay, Phonepay and Paytm,” said Papu Kumar Saoo of Pappu HP, Gas Gramin Vithrak, a distributor from Jharkhand who has done the maximum number of online transactions for HPCL.