wordpress blog stats
Connect with us

Hi, what are you looking for?

Airtel Payments Bank expands distribution network with HPCL deal

Photo showing an Airtel board atop a shop

Airtel Payments Bank is expanding its distribution network with a strategic partnership with Hindustan Petroleum Corporation Limited (HPCL). Through this, customers will be able to access banking services such as opening bank accounts, money transfers, cash deposits and withdrawals at 14,000 fuel stations.

Airtel began its payments bank operations in November 2016 starting with 10,000 outlets in Rajasthan. Subsequently, it became the first payments bank to roll out services nationally. Airtel will use its telecom retail network in towns and villages to open bank accounts.

Interestingly, rival payments bank Fino had signed a MoU with Bharat Petroleum Corporation Limited (BPCL), which owns a 21% stake in Fino, to set up a digital banking and payments ecosystem using BPCL outlets in six states – Uttar Pradesh, Madhya Pradesh, Bihar, Rajasthan, Tamil Nadu and Maharashtra – as banking correspondent points.

Digital bank and MDR

Airtel Payments Bank mentions that customers will not be charged for digital transactions and that makes sense considering that they are trying to be a purely digital bank. Note that payments banks are allowed to issue physical debit cards but Airtel has opted not to issue them to customers. Instead, they will get an online virtual card which can be used for purchases.

It is unclear if the merchant discount rate (MDR), an interbank exchange fee levied on merchants, will apply for these virtual debit cards. The Reserve Bank of India (RBI) is currently looking at a differentiated MDR between acquiring infrastructure involving physical terminals (POS machines, mPOS etc) and digital acceptance infrastructure models. The RBI will also decide MDR for debit cards for petrol/fuel purchases after an industry consultation process with Oil Ministry. More on that here.

Financials

Airtel Payments Bank reported deposits of Rs 68.33 crore at the end of the financial year ended 31st March 2017, which was its first year of operation, according to its annual report. It’s top 20 depositors accounted for around Rs 20.45 lakh (around 0.3% of total deposits), which is probably a function the Reserve Bank of India limiting deposits in Payments Banks to Rs 1 lakh.

You May Also Like

News

The National Payments Corporation of India is in the process of rolling out a completely open source platform for the Unified Payments Interface (UPI)...

News

MobiKwik’s net revenues grew by 134% to ₹379 crore at the end of FY20 from ₹162 crore on the back of higher revenue from...

News

Non-bank lender Bajaj Finance is planning to enter the competitive Unified Payments Interface (UPI) market with its own third-party app called Bajaj Pay. The...

News

Digital payment adoption has grown significantly in the last year, reflecting a secular trend among Indian consumers and businesses, TR Ramachandran VISA Inc’s group...

MediaNama is the premier source of information and analysis on Technology Policy in India. More about MediaNama, and contact information, here.

© 2008-2018 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ

Subscribe to Daily Newsletter

    © 2008-2018 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ