Service Deficiency: 2 in 3 Indian consumers surveyed who use digital payments have 1 or more of their transactions disrupted each month due to poor 3G/4G network quality

June 7th, 2022, New Delhi: Our dependence on the internet has increased manifold, especially in the aftermath of the outbreak of the COVID-19 pandemic as more and more consumers rely on digital services, be it for digital payments, remote health consultations, video conferencing, business, education or personal purposes. Fueled by an increase in the usage of technology in people’s day-to-day life, such as smartphones, tablets and laptops, India’s internet user base crossed the 830 million-mark in 2021 while the volume of wireless internet data usage in India has surged 7 times, as per Economic Survey of India 2021-22. The report further states that India’s average internet data usage has increased from 1.24 GB per month in 2018 to 14.1 GB in 2021. As per data from the Telecom Regulatory Authority of India (TRAI), Jio recorded a 10% rise in average 4G data download speed while Vodafone and Airtel’s speed increased by 8.9% and 5.3%. Another recent report by Nokia in March this year stated that 4G data traffic in India grew 6.5 times in the last 5 years, with the highest-ever shipment of more than 160 million smartphones.

This has prompted the telecom operators of India like Airtel and Vodafone to increase the tariff for both pre-paid and post-paid subscribers. The last tariff hike was made in November 2021 after a gap of 2 years. Bharti Airtel, Vodafone Idea and Reliance Jio had increased their tariffs in November 2021 by 20-25%. Analysts opine that Indian telcos could further increase tariffs in the range of 20-25% this year. Airtel and Vodafone Idea have already said in their post-earnings call that they are looking at tariff hikes during 2022 to boost their average revenues per user. Finance Minister Nirmala Sitharaman in her Budget 2022 has announced that the spectrum auction for the next-generation telecom network will be completed in 2022 so that the telecom operators are in a position to roll out services by 2022-23.

While efforts are underway to roll out a 5G network to consumers in the next few years, at the same time there has been an increase in posts and comments from citizens on LocalCircles platform, complaining that mobile operators providing 3G/4G internet data are not providing the value as per services opted by users. Even a driving test conducted by TRAI across 16 cities, including Dimapur, Kohima, Darjeeling, Kalimpong, Siliguri, Patna, Itanagar, Malda and Agartala, was not up to the mark. In almost all of these regions, telcos, including Airtel, BSNL, Reliance Jio, and Vodafone Idea, could not meet the regulator’s benchmark for 4G network strength and occasionally included the drop call rate. Many on LocalCircles say that their connection fluctuates or is slow most of the time, and despite complaining to the service provider after a cumbersome process to connect with a customer care representative, their issues are not resolved.

Taking cognisance of the issue, LocalCircles has conducted a survey to understand from mobile data users about the network quality they have been experiencing using the 3G/4G data services and what percentage of their payments were getting disrupted due to poor quality of 3G/4G connectivity. To understand consumers and their usage better, the survey also understood the time they generally spend each day on their mobile/tablet/computer accessing or browsing the internet via 3G/4G/data dongle connection as well as the number of times in a month they conduct financial transactions like payments or banking, using the mobile data service. The survey received over 38,000 responses from more than 352 districts of the country. 65% of the participants were men while 35% were women. 43% of respondents were from tier 1 districts, 32% from tier 2 and 25% respondents were from tier 3, 4 and rural districts.

46% of 3G/4G mobile data customers are using them to access internet for 4 hours or more each day

The first question in the survey asked mobile data customers about the time they generally spend each day on their mobile/tablet/computer accessing or browsing the internet via 3G/4G/data dongle connection. In response, 15% said they spend “more than 8 hours” each day browsing the internet via 3G/4G/data dongle connection. 31% said they spend “4-8 hours”, 25% spend “2-4 hours”, and 28% spend “up to 2 hours” each day. On an aggregate basis, 46% of 3G/4G mobile data customers are using them to access the internet for 4 hours or more each day. This question in the survey received 9,886 responses.

62% of 3G/4G mobile data customers are using their connections to conduct 1 or more banking/payment transactions every month

The next question in the survey asked mobile data customers about the number of times in a month they use their 3G/4G/data dongle connection to conduct financial transactions like payments or banking, etc. In response, 9% said they do “more than 30” financial transaction in a month using their 3G/4G/data dongle connection. 12% said “16-30”, 24% said “5-15”, and 17% said “1-4” times in a month. 34% said “none”, or do their transaction using broadband/dsl/fiber connection. 4% couldn’t say. On an aggregate basis, the poll findings indicate that 62% of 3G/4G mobile data customers are using their connections to conduct 1 or more banking/payment transactions every month. This question in the survey received 9,289 responses.

92% consumers of 3G/4G mobile data services face either frequent disruptions or speed issues on a regular basis

The next question in the survey sought mobile data customers’ feedback about their top issue when browsing the internet or making a financial transaction using 3G/4G/data dongle connections. In response, 48% said they face “frequent disruptions due to poor network”, and another 44% said “low speed” is their top issue. Furthermore, 4% of mobile customers cited “other reasons”, and another 4% couldn’t say. On an aggregate basis, 92% of consumers of 3G/4G mobile data services face either frequent disruption or speed issues on a regular basis when browsing internet or making a financial transaction. This question in the survey received 8,210 responses.

66% of consumers surveyed who use digital payments say that 1 or more of their transactions gets disrupted each month due to poor 3G/4G network quality

The next question in the survey sought feedback from consumers who use mobile data to make digital payments about the percentage of their digital payment transactions each month that get disrupted due to poor 3G/4G network quality. These are digital payments which consumers do not end up making digitally but have to resort to an alternate payment mechanism (cash, cheque, card, etc.). In response, 5% said that over 50% of their digital payment transactions get disrupted each month due to poor network; 9% said 20-50% of their digital payment transactions were getting disrupted each month due to it. 18% of the respondents said that somewhere between 10-20% of their digital payment transactions were getting disrupted due to poor network while for 34% respondents up to 10% of their digital payment transactions were disrupted due to bad 3G/4G network. On an aggregate basis, 66% or 2 in 3 consumers surveyed who use digital payments have confirmed facing disruption at least once or more each month with a digital payment transaction due to poor 3G/4G network quality. This question in the survey received 11,865 responses.

In summary, the findings of the survey indicate that 46% of 3G/4G of customers are using mobile data services to access the internet for 4 hours or more each day. 62% are using them to conduct 1 or more banking or payment transaction every month. However, a major concern arises as 92% of consumers of 3G/4G mobile data services surveyed face either frequent disruptions or speed issues on a regular basis when conducting their transactions or browsing. 66% of the consumers surveyed who use digital payments confirmed that they faced disruption with 1 or more of their digital payment transactions each month due to poor quality of 3G/4G network leading them to use alternate means for such payments. These findings are significant because they indicate that not only the mobile data services that are being delivered to consumers are deficient but as a result of this India is not seizing its full potential on digital payments. India did a total of 35 billion digital transactions in 2021 and if network issues are fixed, the number of digital transactions could go up significantly.

LocalCircles will escalate the findings of this study with TRAI, Department of Telecommunications, Ministry of Electronics and Information Technology, Reserve Bank of India, and Ministry of Finance for their understanding and action.