National Payment Corporation of India (NPCI)‘s USSD based Interbank Mobile Payment Service (IMPS) has hit a roadblock with telcos over revenue sharing model, reports The Economic Times. The main objective of this initiative is to reduce the burden on ATMs and promote mobile banking. Currently banks pay Rs 5 to Rs 8 per ATM query.
Citing a joint letter sent by participating telcos to NPCI, the COAI and AUSPI on May 16, 2013, the report states that telcos have disapproved NCPI’s offer of 25 paise per transaction and instead want to adopt a B2B-based billing model by directly negotiating with the banks. It also cites COAI director Ranjan Mathews who says that telcos are now looking to directly negotiate with the banks rather than going through the middle man NCPI to offer these services to its subscribers.
Last year in November, NCPI had rolled out National Unified USSD platform (NUUP) based mobile banking service to boost IMPS based transactions. The service is available on MTNL and BSNL telecom operators and with 23 banks including State Bank of India, ICICI Bank, IDBI bank, among others. At that time NPCI had mentioned that it will eventually roll out the service on other telecom operators.
However, since the service is USSD based, it only works with GSM telecom operators and not with CDMA telcos. Also, USSD based communication is quite cumbersome as compared to apps. The only advantage it offers is that users don’t have to send an SMS or require a GPRS enabled device and this system can be used even on a basic mobile handset.
Related Developments: Last year, NPCI had proposed the use of mobile phones for non-financial banking transactions such as account balance enquiry. In January 2012, the department of telcom had allotted *99# as the USSD (Unstructured Supplementary Service Data) code for the NPCI for operating mobile banking services through the channel. NPCI has been pushing mobile banking for a long time now. According to a recent report issued by NPCI, the Interbank Mobile Payment Service saw a growth of 8.02% in the total transactions taking place, with a 1.62 % increase in total number of Mobile Money IDs (MMID).
In June, PayMate, the company which offers mobile payments solutions for Banks, merchants and other financial institutions,had announced that it will power IMPS based mobile money transfer services for three banks, namely Syndicate Bank, Lakshmi Vilas Bank and South Indian Bank, with five other banks are in pre-launch stage, to allow customers to make inter-bank transactions using a hybrid SMS-IVR mode, in addition to mobile apps and SMS, through IMPS.
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– NPCI Wants To Make Mobile Payment Platforms Inter-Operable
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