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Airtel Money gets payments bank license from RBI

 

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Airtel’s mobile commerce subsidiary Airtel M Commerce Service Limited (AMSL) has received a payments bank license from the Reserve Bank of India (RBI), the company informed BSE through a notification. AMSL, which operates Airtel Money, already has a prepaid payments instrument license from the RBI; Airtel applied for a payments bank license in January 2015, to convert the same into a payments bank license.

In February, Kotak Mahindra Bank bought a 19.9% stake in Airtel’s mobile commerce subsidiary AMSL for Rs 98.38 crore. This came after RBI granted an “in-principle” approval to 11 applicants for a payments bank license in August 2015, which included Airtel and Vodafone. At the time of application for the payments bank license, Airtel Money said that it would form a joint venture with Kotak Mahindra Bank.

Cholamandalam abandons plans on payments bank: It is also worthy to note that Cholamandalam Investment and Finance Company had decided to abandon its plans to set up a payments bank last month. The company owned by The Murugappa Group was one of the 11 firms that got the in-principal nod from RBI in August, last year. A company official was quoted saying that the decision came from the board  after “considering competition and other factors, including the long gestation period”.

Airtel Money details: Airtel Money was launched in 2011 and allows customers to use their mobile phones as a secure way for making payments and transferring money. In India, Airtel Money posted a net profit of Rs 4.47 crore for the year ended March, 2015. The company had posted a loss of Rs 106.26 crore in the fiscal year ended March, 2014.

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Airtel Money hasn’t disclosed operational data for India for since March 2014. At that time, the company had reported an active base of 1.7 million users in India in Q4-FY14, up from 1.3 million in the previous quarter. The total number of transactions made in the country was at 38 million, up 25.8% quarter-on-quarter (QoQ) while the total amount transacted was at Rs 1,364.2 crore for the quarter, up 10.2% QoQ.

Other developments from Airtel Money

-In August 2015, Online cab aggregator Uber and telecom operator Bharti Airtel entered into a strategic partnership to allow Mumbai’s Uber riders to pay with Airtel Money, Airtel’s mobile wallet, in their cab rides in India.

-In the same month, Bharti Airtel acquired a Mumbai-based mobile payment startup YTS for an undisclosed amount. The company said at that time that Airtel Mcommerce Services Limited (AMSL) would integrate the payments and remittance businesses of YTS Solutions.

-Airtel also, appointed Manish Khera as the CEO of AMSL after the acquisition of YTS in the same month.

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