Airtel Payments Bank will be expanding its operations to Andhra Pradesh, Telangana and Karnataka in a couple of weeks following the launch of its pilot in Rajasthan earlier this month, a company spokesperson confirmed to MediaNama. This was first reported by the Economic Times. There is still no time line on when it will launch pan-India operations.
The report added that Airtel is planning around 20,000 Airtel outlets as banking points in Andhra Pradesh and Telangana, and 15,000 in Karnataka. Airtel also said that it has opened more than 1 lakh savings accounts with its payments bank.
Currently, Airtel Payments Bank offers 7.25 % per annum on deposits in savings accounts and a customer’s Airtel mobile number will be their bank account number. It also offers personal accidental insurance of Rs 1 lakh with every savings account.
Airtel said that it will be expanding its merchant network in Rajasthan to 100,000 by the end of the year. The pilot commenced with banking points at 10,000 Airtel retail outlets. It’s worth remembering that the RBI has mandated that a payments banks will be required to have at least 25% of physical access points including banking correspondents (BCs) in rural centres. Airtel has a retail distribution network of over 1.5 million retail outlets across India.
Here’s a list of activities these banks can or cannot do.
Down to eight other players
Apart from Airtel, Vodafone, Reliance Industries, Idea Cellular, Paytm, FINO Paytech, India Post and National Securities Depository Limited all have licences for these new generation banks. In May, Tech Mahindra said that it would not be pursuing a payments bank business. In the same month, Sun Pharma promoter Dilip Shangvi who had partnered with IDFC Bank and telecom operator Telenor to start a payments bank, surrendered his license.
In March this year, Cholamandalam Investment and Finance Company had decided to abandon its plans to set up a payments bank, saying that the decision came from the board after “considering competition and other factors, including the long gestation period”.
Paytm transferring wallets to payments bank
Wallet licences given by the Reserve Bank of India can be folded into the payments bank, according to guidelines.
Earlier this month, Paytm said it would be shifting its wallet to shifted to Paytm Payments Bank Ltd. The transfer of account to the Payments Bank will be done without explicit consent of the customer, though they have the right to decline the transfer by December 21, 2016, as per the notice.