Bharti Airtel has beaten leading mobile wallet Paytm to launch the Airtel Payments Bank. The leading telecom operator will be hosting an event in New Delhi on January 12 for the launch of the service. The event will also be attended by union finance minister Arun Jaitley and Airtel Chairman Sunil Bharti Mittal. The service was announced in December and Airtel even ran a pilot for it in Rajasthan.
While details are sketchy about the Airtel Payments Bank, in the context of demonetization in India, this could be a big deal. Airtel already has its mobile wallet service called Airtel Money and the payments bank is tied to it.
Paytm which is the leading mobile wallet service in the country also recently announced that it had permission from the Reserve Bank of India (RBI) to start its own payments bank, Paytm also squashed rumours of its mobile wallet shutting down and instead suggested that with the new bank, users will earn interest on money in their wallet via the bank.
"There are some rumours circulating that you will not be able to use the Paytm Wallet after 15th January! Nothing could be farther from the truth. On the contrary, Paytm Wallet users will soon enjoy additional benefits through Paytm Payments Bank Account," Paytm said in a blog post.
"After the movement, we will be able to offer our customers a host of new services and features such as savings accounts where they will earn interest as well as being able to avail all the current services," Paytm added.
Similar to Paytm, Airtel Payments bank will offer 7.25 percent interest on savings accounts. Accounts can be opened using EKYC and Aadhaar, and the account will be tied to the customer number. The service will facilitate money transfers to any bank and transfers between Airtel numbers will be free and there will be no ATMs, but instead Airtel is promising easy deposits and withdrawals through its retail outlets. Every saving account with Airtel Payments Bank will also get a personal accidental insurance in excess of Rs 1 lakh.
As this is a paperless system, people will need to use the Airtel Money app to check their account balance.
“Any customer opening a savings account with Airtel Payments Bank will get one minute of talk time on his/her Airtel mobile for every Rupee deposited. For e.g. if a customer opens an account with a deposit of Rs 1000 then he/she will get 1000 minutes of free talk time on his/her Airtel mobile number. The talk time can be used for calling all over India. This benefit is applicable on first-time deposits only,” said Airtel in a blog post in December.
Post demonetisation, mobile wallets have received a huge fillip. Paytm has crossed 50 million downloads on the Google Play store for Android smartphones. It has also built new security features and has built a capability where its service could work even without an Internet connection.
Even the government has launched a new app called BHIM which has quickly grown in user base. Recently, it had crossed 500,000 users, and soon the government will also unveil an iOS version of the app.