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E-Payments: Telcos Not Trying To Get Into Banking; Transaction Cost

Working With Banks Speaking at the IAMAI symposium on Financial Inclusion through mobile phones, Pallab Mitra, Head (Mobile Commerce) at Bharti Airtel repeated multiple times that the telecom operator is not interested in taking on the role of banks, rather, wants to work with banks. "We don't have the wherewithal. A telecom operator will facilitate the ability for a common man to get a bank account with his expertise. We're not trying to get into banking." Mitra said that telecom operators bring connectivity - the last mile - to the table. At the same time, "There are no free lunches. If we're providing value...We're validating a corridor for payment, and can also provide banks with useful information, for example, in the winter when the harvest is over, there are lots of calls from Punjab to Bihar. We're not a dumb pipe." Responding to a question on the role of telco, since RBI has said that telcos cannot become business correspondents for banks, Mitra said that they'll work with partners who are allowed. "If the law of the land demands that all money must pass through a scheduled commercial bank system, we will have to follow that. The customer will be that of the bank since the money lies with the bank." He stressed that banks need to have an average quarterly balance of more than Rs. 2500 from a consumer in an account for a bank to make money from it. "It is not commercially viable for a bank to service to service someone…

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Founder @ MediaNama. TED Fellow. Asia21 Fellow @ Asia Society. Co-founder SaveTheInternet.in and Internet Freedom Foundation. Advisory board @ CyberBRICS

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.

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