Untitled Document
Untitled Document
21 December 2009  
Untitled Document

Technology Big 3
Technology Life

Express Intelligent Enterprise


Technology Senate
Technology Sabha

Contact Us
Network Sites
Exp.Channel Business
Express Hospitality
Express TravelWorld
Express Pharma
Express Healthcare
Group Sites
Indian Express
Financial Express

Untitled Document
Home - Technology - Article


Green mobile money transfer

This service targets the un-banked population of India enabling them to send or receive money instantly using their mobile phones, writes Nivedan Prakash

Green Mobile Money Transfer is a financial inclusion based program. It currently targets migrant workers and facilitates mobile money transfer for them. This service has been launched by Corporation Bank and Tata Indicom along with PayMate, which is the technology/platform provider for this initiative.

Tata Indicom brings in its vast distribution network of PCOs across the country with 1 million potential touch points. Corporation Bank, which is completely on the core banking platform, with presence and penetration in geographies of immediate interest to us, for example, the southern corridors, provides the banking platform, and PayMate brings the technology platform to facilitate money transfer across the PCO network using Corporation Bank’s banking platform.

For now, the service is available for migrant workers from Kerala working in Mumbai and Bangalore wanting to remit money back to friends and family in Kerala. This financial inclusion program entails setting up no-frills bank accounts for customers needing to remit money along with providing them other financial services which could include but are not limited to micro credit, micro insurance, direct government deposits, etc in the long term.

Ajay Adiseshann, Founder and MD, PayMate, pointed out, “The service is called Green because we believe green is the color of rural India and also symbolically, green is the color of money. Moreover, green is a simple name to communicate to the average Indian who is conversant with English words like the names of colors and basic numbers. This is the fundamental principle in naming this service green.”

“The opportunity stems from the fact that India is largely under-banked or un-banked with approximately 200 million bank account holders. India currently has 488 million mobile phone subscribers. 88% of Indian financial transactions are cash driven. Over a period of time, they will move to various electronic channels with the mobile channel being the only potential mass-based electronic channel with close to 40% subscriber penetration across India,” added Adiseshann.

Going by present numbers there is a potential need for financial services for 300 million mobile phone subscribers. Step one would be to bring them into the banking system by offering them a much required, quick, efficient, and secure money transfer via the Green mobile money transfer service.

How it works

"India has 488 million mobile phone
subscribers and 88% of Indian financial transactions are cash driven. Eventually, they will move to various electronic channels with the mobile channel being the only potential mass based electronic channel with close to 40% subscriber penetration across India"

- Ajay Adiseshann
Founder and MD, PayMate

A customer has to go to a Green registered PCO outlet that will facilitate the customer to open a no-frills, zero-balance account, which is a 48-hour process. Thereafter, the customer has to hand over the cash to be transferred to the PCO. There is surcharge of 5% on the transaction. The PCO will then use his mobile phone to initiate the transfer via SMS and IVR enabled by PayMate’s technology. The entire transfer happens through a simple instruction via text message and confirmation over IVR to move the money from the PCO operator’s Corporation Bank account to a pool account.

A unique code will be generated against that transaction and the sender will receive that unique code which he will then communicate to the recipient. The recipient will walk to the closest PCO activated for the Green Money Transfer service and hand over the code. The receiving PCO operator, again using the same technology used by the sending PCO operator, will use his mobile phone which is linked to a Corporation Bank account to pull the money from the pool account into his account. The moment that money has been credited to his account, he will open his drawer and hand over the cash to the recipient.

Adiseshann further commented that the technology is Windows based .Net Framework technology which is PCI DSS compliant and connects into the core banking platform of the bank and then facilitates both the credit and debit of the account on a real-time basis as well as all back-end report generation and other features required to settle the transaction from end-to-end.

“The core platform technology, reporting structure and all other related aspects of transaction processing is what our platform handles including automated IVR calls through a secure channel,” he added.

Significance of this service

The service is constructed in a way that the retail outlet has to perform the bulk of the work keeping the end users task to a minimum. The maximum they need to do is enter the PIN when they receive the IVR call and thereafter share the transfer code with the receiver. Most of the work is done by the sending and receiving PCOs.

Unlike Net banking, here everything is done on a mobile and it is instantaneous. The moment the money moves to the pool account, it will be available with the receiving party to pull the money down in a matter of seconds. The pool account currently has to be maintained with Corporation Bank—all money being remitted sits over there till it’s requested to be moved to a receiving account using the unique code that is generated for that transaction. The receiving PCO gets a confirmation when the money has been remitted to his account.

There is no operator dependency. Although the service is using the Tata Indicom PCO and True Value Shop (TVS) network, the users can have any SIM card on any network using the most basic mobile phones without any application download; just using an SMS to send an instruction and to initiate a secure, computerized IVR based call mechanism to enter their PIN allowing money to move from one account to another account. Overall, there is carrier and banking grade security across the board on the PayMate platform which is PCI DSS 1.2 certified.

Adiseshann asserted that this service would bring about a transformation in this space and change the landscape. “I don’t think that we, as a country, have been able to effectively bring financial services to the masses. People from lower-income groups who have always been subject to a paucity of financial services will now have access to various other banking and financial services going forward,” he added.

Going ahead

In the last few years, the phenomenal growth in mobile penetration has swept the landscape and is a boon for companies like PayMate as they try to exploit the presence of a mobile phone in every pocket to bring the unbanked population of the country into the Indian financial system.

Here, the first touch point would be remittance because that’s the need or pain-point that the company is addressing. Once it addresses this need effectively, thereafter that person is open to various other financial services starting from branchless banking to micro credit or micro insurance to direct government deposits.

Moreover, it’s a first true mobile money transfer based un-banked service, which is rolled-out across the country on a scale which combines an operator with a million touch points potentially along with a highly recognized bank and, most importantly, PayMate has 25 banks on its platform. “So over a period of time, we will roll out other banks also to scale in such a manner that this becomes a standard service on the lines of money order in the country over the next two-three years. This is how all the partners have come together to achieve this goal,” stated Adiseshann.

“We have already identified other corridors and we will be rolling out services starting in about two months. Financial services for the market have to go the mobile way. There is no other route. Opening up new branches or ATMs in the countryside or remote locations will be expensive. Besides, there are infrastructure issues as well. From this perspective, we are adequately poised to take this kind of service to the masses,” concluded Adiseshann.



[an error occurred while processing this directive]
[an error occurred while processing this directive]
Untitled Document
[an error occurred while processing this directive]
[an error occurred while processing this directive]
Untitled Document

FEEDBACK: We would love to hear from you -- what you like about our content, what you dont, and even how you think we can improve. Please send your feedback to: prashant.rao@expressindia.com

Copyright 2001: The Indian Express Limited. All rights reserved throughout the world. This entire site is compiled in Mumbai by the Business Publications Division (BPD) of The Indian Express Limited. Site managed by BPD.