Indian telecom giant Bharti Airtel came up with its bank in Rajasthan. This bank is considered as the first Payments bank in the country. The company selected Rajasthan as its stepping stone into banking sectors for its vivid banking exposure.
Though the company has planned to launch its payments bank by the end of last month, it was denied. Now, the influence of demonetisation is avid in almost every part of the country and the idea of implanting virtual money seeded into the common mans’ brain.
What are Payment Banks: Payments banks are a new model of banks conceptualised by the Reserve Bank of India (RBI). These banks can accept a restricted deposit which is currently limited to INR 1 lakh per customer account. These banks cannot issue loans and credit cards. Both current account and savings accounts can be operated by such banks.
The company initially launched 10,000 merchant units across the state and it aims for 1,00,000 customers by the end of this year giving a big boost to digital payments ecosystem.
“Airtel Payments Bank will play an important role in taking banking services to the last mile in a quick and efficient manner and benefit millions of unbanked citizens of this country. With this pilot, we have taken a big step towards the launch of our banking services and will be testing our operational readiness for full-scale launch across India,” Shashi Arora, MD & CEO, Airtel Payments Bank, said in a statement.
After being the first company to attain Payments bank license from the Reserve Bank of India, Airtel acquired 20% stake from the Kotak Bank.
The accessibility of the bank account is quite easy and flexible to operate, now people don’t need to use any Credit cards or debit cards. Airtel is taking advantage of its massive customer count which is precisely 1.5 million. Now, every Airtel network user can open a bank account just by reaching the nearest Airtel retail store.
The company further adds that the mobile number itself will be the Bank account number and no paper work is needed for account opening, the whole operation will be processed through soft copies that includes Aadhaar-based eKYC.
The beneficial factors on proceeding with Airtel Payments Bank include:
The company also announced that its license for Payments Bank was issued long after in April under the governance of Raghuram Rajan.
In August 2015, 11 entities, including Bharti Airtel, Tech Mahindra, Paytm, were given an in-principle nod to set up operations. Three entities, including Tech M, Cholamandalam Finance, and IDFC Bank along with Telenor were tapped out of the race.