HDFC Bank has launched a POS machine called DigiPOS which will allow customers to pay via newer methods such as the Unified Payments Interface (UPI), BharatQR, SMS Pay and the PayZapp wallet, in addition to debit and credit cards. The bank added that it will be converting its entire network of  PoS machines to DigiPOS without any investment by the merchants.

SMS Pay is a payment option on the DigiPOS where merchants can initiate a payment to customers via SMS. For UPI and BharatQR payments, the POS machines will generate a QR code where customers can scan and pay, similar to Axis Bank and Innoviti Payments’ solution

Note that HDFC Bank has not enabled Aadhaar Pay and NFC on the DigiPOS machines. That’s possibly due to the additional infrastructure needed to scan finger prints and the huge number of failures in the Aadhaar Pay system. However, the bank does not issue NFC debit and credit cards and hasn’t built an acceptance infrastructure for it as well.

“For contactless payments, the handsets have to be compatible. Right now only the high-end phones are NFC compatible. The merchant also has to be NFC compatible to accept payments. So this will need some time, till the handsets are affordable,” Nitin Chugh, head of digital banking had told MediaNama back in 2015. This is slowly changing: Nokia’s recent launch the Nokia 3 priced at Rs 9999 comes with NFC support, which is probably the cheapest phone right now

Salman adds: However, this is slowly changing: Nokia’s recent launch the Nokia 3 priced at Rs 9999 comes with NFC support, which is probably the cheapest phone right now in the market with NFC integration.

Competition

HDFC Bank is facing heavy competition from State Bank of India on the POS front and in May 2016, it overtook HDFC Bank as largest issuer of POS terminals. SBI has over 6.02 lakh terminals at the end of the June quarter compared to HDFC’s 4.23 lakh.

Meanwhile, the bank will face competition from third party POS players such as ItzCash, Mswipe, Ezetap and Paynear.

  •  ItzCash has integrated BharatQR on its POS machines, where customers can pay the amount of sale by scanning the QR code.
  • Paynear, a digital payments company and a mobile point of sale (POS) terminal provider, is running an Aadhaar Pay pilot. The pilot included 50 merchants.
  • Mswipe has upgraded all of its POS terminals to accept NFC payments and also has a partnership with Samsung Pay as well.