Technology in Banking-Insight and Foresight for BTA_2011 ... - IDRBT

Technology in Banking – Insight & Foresight 22
Nokia Money launched its services with Yes Bank and Union Bank of India to provide financial
services to customers. Nokia plans to use its distribution network coupled with the financial
prowess of the banks to provide a service of its kind.
Airtel received approval to issue prepaid instruments from regulators and launch it in the
name of Airtel Money. Other mobile operators too are defining models wherein payment
and/or transfer enabling instruments would be launched either on their own or with banks,
leveraging the principles of business correspondents.
In the area of proximity payments, Citibank, in conjunction with Vodafone and Nokia
conducted an NFC (near field communication)-based mobile payments trial in Bangalore,
which saw considerable success. However, the scalability would depend on the proliferation
and adoption of NFC-enabled handsets and acceptance capabilities at merchant outlets.
There are several players in the space of financial inclusion such as FINO, ATOM, Eko and
ALW who offer a bouquet of services such as deposits, cash withdrawals and payment and
transfer transactions via the mobile channel.
3.2.5. New Trends in Mobile:
The success of MPesa in Kenya has provided an appetite for a host of global players whose entry into
the Indian market is only a matter of time. The Indian market for payments and transfers is set to
witness several interesting and possibly unique business models and consumer propositions.
Furthermore, with the introduction of 3G services, a host of value-added products and services will
be unleashed, which could potentially be purchased via mobile based wallets managed or even
operated by mobile operators.
3.2.6. Operator Bank Tie-ups
Three of India’s largest mobile operators have tied up with India’s largest banks to offer a bouquet of
mobile-based banking and financial services to their customers.
Airtel and State Bank of India: A joint venture company has been set up that envisages
opening bank accounts, cashless transfers, cashless spending and payment facilities,
targeting the rural and urban poor. Customers would be offered a no-frills banking account
from SBI, across Airtel’s 1.5 million+ retailer network. Both partners have envisaged investing
more than INR1 billion in this enterprise. The JV plans to acquire more than 2 million
accounts annually.
Vodafone and the ICICI Bank: Similar arrangement being entered offering financial products
ranging from savings accounts, prepaid instruments and credit products through a mobile
phone platform
Idea and Axis Bank: They have entered into an association to offer financial services to
customers under the Idea Mycash brand. These players have partnered a pilot launch in the
Dharavi-Allahabad corridor and have plans to shortly launch the service at a pan-India scale.
3.2.7. IMPS Merchant Payments
NPCI, encouraged by the launch of IMPS for individual-to-individual money transfers, is all set to
foray into the field of merchant payments. RBI has already permitted the payments institution to go
ahead with merchant payments on the IMPS platform. NPCI is all set to launch the pilot of this new
service with seven banks.
Institute for Development & Research
in Banking Technology