i nc lu s i ve f i nanc e i nd i a re port 2014
72
volume picked up after 2009
–
10. Average volume of
transaction during the period 2010
–
14 increased from
Rs. 9,500 to Rs. 22,000.
The NPCI has successfully demonstrated through
pilots the working of the Aadhar Enabled Point of Sales
(AEPS) transaction which is meant to facilitate online
interoperable transaction at MicroATMs/PoS through
BCs. The transactions include withdrawals and deposits
along with funds transfer between Aadhar card holders.
The customer inputs required are issuer identification
number (IIN), Aadhar number and the finger print used
during her enrolment.
The performance indicators of various payment sys-
tem segments show that during 2012–13 the share of
paper-based instruments in the volume of total non-cash
transactions was lower than that of electronic payments.
For instance, the retail electronic segment too has reg-
istered a significant growth of 35.2 per cent in volume
and 54.9 per cent in value (RBI, 2014). A close look at
the working of the payment system, however, reveals that
while the performance of electronic payments has been
impressive over the years, all sections of the population
do not have access to its benefits. The users are largely
concentrated in tier 1 and tier 2 locations and already
have access to formal financial services. ‘The segment of
the population that has missed out the bandwagon of
modern electronic payments are the country’s unbanked
and under-banked people who constitute a significant
portion of the population’ (RBI, 2012, 5). Though there
is a significant untapped market for electronic payments,
issues such as standardization, interoperability, consolida-
tion, data security and creation of common infrastructure
remain major challenges. Also needed are innovations in
product and delivery channels.
3.9 MOBILE BANKING
The first set of mobile banking guidelines issued by RBI
in October 2008 permitted banks to facilitate funds
transfer through mobile phones from one bank account
to another bank account, both for personal remittances
and purchase of goods and services. Currently, there is
no monetary restriction on such fund transfer. It is left
to the risk perception of banks and their bank-approved
policies. For transactions in excess of Rs. 5,000 RBI
mandates end-to-end encryption. Under the Domes-
tic Money Transfer guidelines banks are permitted to
facilitate transfer of funds from a bank account for cash
payout to a beneficiary who does not have a bank ac-
count at ATMs/BCs. The limit is fixed as Rs. 10,000 per
transaction with a cap of Rs. 25,000 per beneficiary.
Real time inter-bank mobile banking payment has
been facilitated through the setting up of the Inter-
bank Mobile Payment Services, rechristened recently as
Immediate Payment Service (IMPS) and operated by
the NPCI. The IMPS enables real time transfer of funds
between bank accounts and provides a centralized inter-
bank settlement service for mobile banking transactions.
As on 31 May 2014, 86 banks, including 10 RRBs and
19 UCBs, had been permitted to launch mobile banking
services. The customer base of banks who have subscribed
to mobile banking services stood at nearly 30 million as
of October 2013 (RBI, 2014b).
Despite low volumes, mobile banking has been
growing in recent years. As per the data furnished by the
Technical Committee on Mobile Banking the users of
mobile banking increased from 6 million to 22.5 million
in three years—2010–11 to 2012-13. The value of mobile
banking transactions during this period rose from Rs. 6
billion to Rs. 60 billion.
Between December 2010 and August 2014, the
number of Mobile Money Identifiers (MMID) issued
increased from 4.7 million to 63.2 million and the num-
ber of transactions from 2001 to 5 million. The total
amount transacted rose from Rs. 4.61 million to Rs. 37
billion. It was around the second quarter of 2012 that
both the volume and value of IMPS transactions started
rising rapidly (Table 3.5 and Figure 3.6). According to
RBI statistics, 53 million non-IMPS mobile banking
transactions amounting to Rs. 59,900 million took place
in 2012–13 (RBI, 2013).
The Technical Committee has noted that mobile
banking transaction is a more economical traditional
banking channel in terms of per-transaction or per-
branch costs. But, with a mobile subscriber base of 870
million and bank accounts of around 450 million, there
are only 22 million active mobile banking customers in
India. In other words the large mobile subscriber base has
not been leveraged for financial inclusion in the coun-
try. The committee has recommended that the mobile
banking channel be encouraged in view of the long-term
economic gains.
