Paymate Signs Up IDBI Bank; A Look At Payment Co Tieups

Paymate has tied up with IDBI Bank, their 8th bank partnership in India. The company also has a presence in Sri Lanka, and recently powered services for a partner (Paybill) in Nepal. Paymate claims to have tie-ups with around 13,000 merchants. Interestingly, since Paymate uses the Interactive Voice Response service to verify payments, so they don’t necessarily have to have a tie up with telecom operators. 

Paymate competes with MChek, NGPay and Obopay in India. Do see our list of digital payment companies here. We compiled a list of their banking partners, based on what has been mentioned on their websites, and it does seem strange that HDFC Bank has tieups with MChek, Paymate and NGPay. How does this work - does the bank give customers an option to choose any one? Sure will be confusing for a customer.

Note that MChek has tied up with State Bank of India (SBI), which is India’s largest Public Sector Bank, ICICI Bank, India’s larges private sector bank, and HDFC, another large private sector bank, though I can’t quite understand what is going on with HDFC, given their multiple tie-ups. The following situations are possible in this ecosystem:

1. Bank has the consumer interface: the bank will then choose the payment company, and will have to tie up with all telecom operators
2. Telco has the consumer interface: the telco will choose the payment solutions company which will have to tie up with all banks
3. Payment company has the consumer interface: which means it will have to tie up with all the banks and all the telecom operators.
4. Free for all: utter confusion with either banks tying up with multiple payment companies and/or multiple telcos. The consumer doesn’t know where to go.  

Given the mobile banking guidelines, it appears that the bank has the consumer interface, and the onus is on the payment company to ensure telecom operator tieups. So it is likely that a bank will have only one payment company, and avoid confusion for the consumer. So what then is HDFC Bank doing?

Note (6th Jan 2008):  the table above has been updated, following inputs from Paymate that the company has signed up with Lakshmi Vilas Bank, and Tata Teleservices on the telecom front.

On Bookmyshow’s Airtel Partnership

Ticketing company Bookmyshow.com will offer Airtel subscribers across India access to tickets for movies, concerts, events, plays and sport events via a mobile application, Bharti Airtel’s on-deck WAP portal Airtel Live (http://live.airtelworld.com), and voice call at 54321-91, which gets redirected to the Bookmyshow call center for tele-booking. The price for telebooking isn’t mentioned in the release, but customers are going to be in for a rude shock if they’re charged standard voice portal rates (Rs. 6/min) for dialling 54321-91.

But why does Bookmyshow need to partner with Airtel? Does the direct to consumer model not work for Mobile Ticketing? Partering with the mobile operator gives the company the opportunity to reach out to a larger customer base. Mobile ticketing has been piloted in the past - by PVR Cinemas and Fame Adlabs, but we really haven’t heard of them after their launch; I don’t think they’ve achieved any kind of scale. I had tried out the PVR application two years ago (it’s been that long. 

(more…)

Reuters Market Light To Expand To Haryana In Jan; 9 States By 2009 End

I had a fairly long chat with the Reuters Market Light executives at India Telecom 2008: little over a year after the service was launched, the SMS based Market information service for farmers in India has crossed 100,000 users, with around 91,500 subscribers in Maharashtra, and 8,500 subscribers in Punjab. The growth in Maharashtra appears to have picked up in the last two months - when they had only around 50,000 subscribers in Maharashtra. Perhaps the tie-up with the post office helped. 

Thomson Reuters has aggressive expansion plans: they’re launching the service in the agriculture dependent state of Haryana in January, and then to 9 states across the country by the end of 2009. In the north, they intend to cover Harayana (January), Himachal Pradesh and Uttar Pradesh, apart from Punjab where they are already present. In the west they’re targeting Gujarat, apart from Maharashtra, where they had launched; Madhya Pradesh in Central India is also a part of the plans, and the company is yet to decide between Karnataka and Andra Pradesh in the South.

(more…)

PayMate Powers PayBill Mobile Payments Services In Nepal; Why Not Direct?

Paymate, the Mayfield Fund, KPCB and Sherpalo ventures funded mobile payments company has announced the launch of its mobile payment services in Nepal through a local representative PayBill. Paymate appears to be providing the technology solution to PayBill, to enable consumers to pay for mobile recharge, pay utility bills, buy tickets, P2P money transfer, etc. PayBill has partnered with Nepals largest private bank Everest Bank and Nepal Telecom, the countrys largest telco.

Three months ago, when Paymate had announced plans to launch in Nepal, there was no mention of PayBill. According to Manish Kumar Subba, Founder and CEO of PayBill Pvt. Ltd, the project has been in the works for over 14 months.

Outside of India, Paymate has a presence in Sri Lanka, where it has a tie-up with Bank of Ceylon. Ajay Adiseshann, MD of Paymate had told Mint in September that the company expects overseas to contribute 12-15 percent of revenues by March. Their tie-up in Sri Lanka is a 50-50 JV, focused primarily on remittances.

State run Nepal Telecom has 2.2 million subscribers, and operates both GSM and CDMA services. PayBills services, like Paymates in India, are SMS based, though the PIN authentication for Giftmate (which I’ve used) is IVRS based. I do think there’s an issue with the number of PINs one needs to remember now - a separate PIN for the ATM, for Internet Banking and mobile banking. If the account is the same, shouldn’t the PIN be independent of the mode of access?

Update: Probir Roy, Founder of Paymate told MediaNama that Paybill brings to them the local relationships and infrastructure - Paybill is a bill payment gateway, much like Billdesk in India. Paymate hasn’t set up their own infrastructure in Nepal, and the service is being launched as PayBill, powered by Paymate.

Note: Do take a look at our list of Digital Payment companies in India, covering mobile payment, cash card companies, payment gateways etc. It’s still a work in progress, so in case we’ve missed any, leave a message, or write to nikhil@ medianama .com.

Reuters Market Light Expands To Punjab; Only 50,000 Subs

After a pilot in the state of Maharashtra, Thomson Reuters has expanded services to the state of Punjab. According to a company release, the service has signed up 50,000 users in Maharashtra, and they intend to expand to a third state by the end of the year. An interesting tidbit - they’re using post offices in Maharashtra to drive registrations.

Now with just 50,000 subscribers in Maharashtra, they’re falling short of the 250-300,000 subscribers that former EVP, Media (Asia) Azhar Rafee had outlined a few months ago in an interview: RML will have to add over 70,000 subscribers a month this year to achieve that goal. Perhaps Punjab, among the richest states in the country, and a largely agricultural state at that, should help them close in on that goal. Rafee had said then that Reuters also intended to make the service - covering 17 different crops - in multiple languages.

I do think that voice based, multilingual, services are a better bet than SMS - since in some states, lack of education is an issue. However, costs will be an issue, and pricing the voice services at Rs. 6 per minute will not work.

Related:
- Bharti Airtel To Focus On Livelihood, Education & Healthcare For Rural Outreach
- Reuters Market Light Now Available in Local Post Offices across Maharashtra

Clarification On Eko Financial Solutions And Mobile Banking Userbase

A clarification from Abhishek Sinha, CEO of Eko Financial Solutions, on a story we had earlier done about sustainability of Mobile Payments. Sinha says that while they are leveraging the mobile, they’re not in the mobile banking space as such. The company is doing branchless banking under the Business Correspondent model and looking at the unbanked segment. Thus, the 20-25 million customer base he had mentioned to Mint was for their business as a whole, and not mobile specific.

From his comment to the earlier post:

“Eko is not clubbed along with Obopay, mChek, PayMate, ngPay. These players and similar others are looking at the banked customer base and adding value by giving efficient, secure and user friendly mobile interface for various banking and commerce needs. Eko is in the financial inclusion space wherein the model is entirely different. Here we see a potential to bank 400 million people in the next 5-7 yrs.

We are doing a pilot on Branchless Banking using Mobile Phones and Agent Model. We see that the need for domestic remittance will drive the adoption of service. Eko believes that it can facilitate this through a bank-led Business Correspondent model and offer many more services to the customers based on aggregation.

As our model is a bank-led model, we first give a bank account to the customer. Kindly have a look at the following video.

In the video, you will see basic user interface for people who may be just about number literate. Unlike the sophisticated interfaces offered by other players.

I hope this justifies the difference in the game, the customer segment and hence the size of the market for Eko.”

M-Banking Guidelines For India Issued; Ridiculous Transaction Limit

The RBI has issued a new set of operative guidelines for Mobile Banking in India, with changes based on comments from stakeholders. A couple of things significant in this set of guidelines:

Transaction limit
Transactions are limited to only Rs. 2500 ($55) per day, and Rs. 5000 ($110) per day, per customer. While this is an increase over the Rs. 1500 ($33) transaction cap and Rs. 2500 ($55) mentioned in the previous guidelines, it is still a very small amount. Take my example - My mobile phone bill is over Rs. 4000 per month, and I won’t be able to pay it using mobile banking services. This appears to a move to reduce the impact of fraud, since they’ve also asked banks to put a monthly transaction limit, based on the bank’s own risk perception of the customer.

Across Mobile Operators
The onus, clearly, is on the banks to ensure that customers across mobile operators have access to mobile banking services. They may restrict themselves only to one mobile operator for a period of six months. Two scenarios are possible in this instance:
– Either banks will have to partner with multiple mobile payment service providers, each of whom have access to different operators, or
– Mobile service providers will have to provide banks with access to different operators.
For example, MChek provides ICICI Bank, SBI, HDFC and Corporation Bank services only on Airtel in India. So either MChek will have to tie-up with all operators within six months, or these banks will have tie up with different service providers. One bank with many service providers faces an issue - it will confuse customers. It’s like having a different short code for a different operators.

Download the guidelines here
More issues with the guidelines: (more…)