A recent Boston Consulting
Group (BCG) report titled "Weathering the Storm: Global Payments 2009" indicates that
while payments have been a bellwether business model for banks, going forward,
in today's tumultuous times, the key to success will be a lean, end-to-end
business model aimed at achieving the highest possible level of efficiency on the
retail side of the banking business. It advocates that European policy
makers should therefore focus on setting up industry standards for electronic and
mobile payments to bring about the desired efficiencies instead of focusing
on massive SEPA-related investments.
Clearly, India seems to be one step ahead of Europe and North America
in this. More by default perhaps than by design.
Three de jure industry guidelines are in effect or being developed: (a)
Mobile Banking Guidelines; (b) Prepaid Instruments Guidelines; and (c)
Mobile Banking for Financial Inclusion. Other recent directives by the RBI, such
as cash-out at a bank merchant outlet of up to Rs 1,000 a day using debit
card, liberalizing the definition of BCs for facilitating Financial Inclusion,
rationalizing the settlement period between intermediaries and merchants, are
also significant. All these provide the first set of cornerstones in the country
for mobile payments and banking. As of now, there are 32 banks which
have been approved by the RBI for some form of mobile banking/payment
service. PayMate powers more than half of these.
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