Alternate revenue models for Payments Banks in India

Contents
Executive Summary................................................... 1
1. A background to Payments Banks in India ......................... 3
1.1 An inflection point for financial services in India ..................................5
1.2 Enabler for broadening reach of financial services in India ..........................5
2. Evolution of the Payment Banks towards complete financial inclusion. . . . . . . . .6
2.1 The rapid scale-up of Aadhaar ................................................7
2.2 The rapid scale-up of digital wallets in India ......................................7
3. A step towards ubiquitous banking access and cashless society ............. 8
3.1 Instant documentation and onboarding process ..................................8
3.2 Near zero marginal cost of transactions .........................................9
3.3 Adopting a digital first approach ............................................. 10
3.4 Complete interoperability across all systems participating in a transaction ........... 11
3.5 Solutions designed for everyone, across customer segments ...................... 11
3.6 Data-led near real-time decision making ...................................... 11
4. Alternate revenue models for Payments Banks.......................... 12
4.1 Facilitate micro savings .................................................... 13
4.2 Create large scale access to credit ........................................... 14
4.3 Merchant acceptance: provide “acquiring” as a bundled service to merchants
with a focus on low-cost acceptance .......................................... 15
4.4 Marketplace for financial services and local commerce ........................... 17
4.5 Data ................................................................... 17
4.6 Platform approach toward banking and payments ............................... 18
5. The way forward.................................................. 19