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YES Bank reports 22.4M UPI transactions for December 2017; AEPS, Chatbot

YES Bank, which is the bank partner for PhonePe’s UPI service, reported 15% UPI marketshare for the month of December 2017: around 22.4 million transactions, a growth of 33 times from 0.65 million transactions by the end of December 2016.

22.4 million transactions in December is still 3.6x from 6.27 Million reported by YES Bank in September 2017. UPI has grown much more, with the entry of Google and Paytm, but that growth appears to have helped YES Bank (and hence PhonePe) as well. Note that back in July 2017, YES Bank had 38% of the UPI marketshare, so the share of growth is largely that of players other than YES Bank.

YES Bank (and hence PhonePe) claim around 75% marketshare of Merchant Payments for UPI. Last quarter, YES Bank had claimed 65% of UPI Merchant transactions, so its position has strengthened to 75% when it comes to merchant transactions.

“…this is a reflection of our frugal innovation payment systems which the bank has developed in-house and taking full advantage of the India public stack. And our digital banking team is leveraging this to become one of the foremost
players in our country in frugal payments,” Rana Kapoor, the Banks CEO and MD said on the earnings conference call.

In October 2017, the RBI had fined YES Bank Rs 6 crores for failing to report a security breach in their ATM network, saying:

A cyber-security incident involving ATMs of the bank was also not reported by the bank within the prescribed timeframe. Based on the inspection report and other relevant documents, a Notice was issued to the bank dated July 6, 2017, followed by a supplementary notice dated August 24, 2017, advising it to show cause as to why penalty should not be imposed on it for non-compliance with directions issued by RBI. After considering the bank’s replies, oral submissions made in the personal hearings, as also the additional information and documents furnished, RBI came to the conclusion that the aforesaid charges of non-compliance with RBI directions were substantiated and warranted imposition of monetary penalty.

AEPS launch: Cash withdrawals using just Aadhaar number and fingerprint

YES Bank has gone live on Aadhaar Enabled Payment System (AEPS) in partnership Nearby Technologies. “This has enabled our 2,000 Business Correspondent Agents for Aadhaar based Cash Withdrawals & Cash Deposits”. It enables “card less and PIN-less Aadhaar ATM service.” and “Using the PayNEARBY mobile application on a smart phone, a Retailer can become an Aadhaar ATM / Aadhaar Bank Branch for cash withdrawals and deposits by a customer. ” Cash withdrawal and other transactions are made possible by simply using Aadhaar Number and finger print. PayNEARBY’s Aadhaar ATM will be available through YES BANK and the BC Agent network comprising 40,000 touchpoints.

Other notes from YES Banks results announcement

  • Mobile Banking: YES Mobile had over 3 million transactions worth ~ Rs 50 Billion within Q3FY18, while it observed a significant increase both in Value (~6X) and Volume (~3.5X) y-o-y
  • Chatbot: YES Bank’s Facebook Messenger bot, which it tells its investors is “India’s first artificial intelligence enabled banking bot” handled 120,000 customers queries in 3 months, since its October launch. It offers banking services like funds transfer, check balance, recharges, bill payments and answering frequently asked questions (FAQs) of users, GPS assistance to locate nearest YES BANK ATM/ Branch. Bank in January 2017, the company had launched a chatbot with Gupshup.
  • YES FINTECH, the Bank’s fintech accelerator unveiled its 2nd cohort, shortlisting 8 companies from over 500+ applications from 10 countries

Last quarter

For the quarter ending September 2017, YES Bank had reported 6.27 million IMPS transactions, up from 1.44 million YoY. YES Bank had launched BharatQR enablement its YES Mobile app, for QR code based payments, Nashik
SmartCity ‘SmartPay’ Open loop Prepaid Cards, and the BHIM YES PAY app had enabled services like “BBPS, Bharat QR, RuPay card, IMPS, UPI and Aadhaar KYC”. In May 2016, YES Bank had launched Facebook@Work, “with 100% activations within 45 days of launch.”

View: Press Release | Investor call

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