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Thursday, February 15, 2007
Companies like Reliance Communications and Airtel are coming up with innovative mobile payment solutions that allow mobile users to pay for their purchases by a simple SMS. What's more, payments over mobile can be done even on a basic mobile, thus eliminating the need for high-end mobile phones.
The latest in line is a mobile payment solution by Paymate, which provides Citibank consumers the option to make payments through SMS. Earlier last year, Airtel had joined hands with ICICI Bank and VISA for offering mobile-to-mobile payment option, allowing Airtel customers and ICICI Bank Visa cardholders to pay using Airtel mobile phones.
Reliance Communications and Reliance Energy have also tied up to allow their consumers in Mumbai to pay their electricity bill via Reliance Mobile World using ITZ cash card. However, PayMate is not limited to a particular mobile phone operator or technology and works with both CDMA and GSM. Moreover, it does not require GPRS connectivity or SIM upgrades meaning that a basic phone is all that is required. "The customer authenticates every transaction by providing the pin number, which is given at the time of registration and all charges are debited real-time to the account. Customers can choose to link their mobile number to their existing credit card or debit card as preferred," says Ajay Adiseshann, founder and MD Paymate India.
WAIT AND WATCH
Even though companies are now offering mobile payment solutions, mobile payment is yet to become mainstream. Most companies are wary and still grappling with doubts of whether something like mobile payments would work in a market like India. Being cautious they are still using the 'wait and watch approach'. The situation is only likely to improve with the entry of other innovation centric organizations in offering such services and the rest will follow suit.
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Last year, Airtel had joined hands with ICICI Bank and VISA for offering mobile-to-mobile payment option, which enabled Airtel customers and ICICI Bank Visa cardholders to pay for their purchases using Airtel mobile phones. The retailer sends an SMS mentioning the amount to the customer who then enters the personalized PIN number and sends an SMS back to the retailer acknowledging the amount to be paid. Both parties then get an SMS indicating the completion of the transaction. Airtel customers were issued a new SIM card free of cost and ICICI Bank cardholders were issued an add-on card.
In another instance of mobile payments becoming popular, ADA Group owned Reliance Communications and Reliance Energy, tied up to allow their consumers in Mumbai to pay their electricity bill but only via Reliance Mobile World by using ITZ cash card.
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Mobile payment, though, is likely to find favor with enterprises and users alike, considering the benefits it holds for both. Benefits to enterprises vary from reaching out to a remote customer base via the mobile to shortened payment cycles. A mobile payment gateway offers enterprises and merchants value addition, which ultimately translates to the end user. It offers enterprises with several transaction interfaces such as the Internet, mobile phone and landline phone (which currently has a very low sales conversion rate) so as to enable them to offer the customers more payment options. For the consumers, it's all about the convenience of paying from anywhere, anytime at the press of a button as well as the added security of not divulging the card details.
Keeping in mind the immense benefits accruing from mobile payment, it is expected to change the future of transactions. It has all the requisite ingredients for making it a preferred payment platform for both merchants and consumers.
But the transition will not happen overnight or in a few days. Consumer adoption, although gradual, is still expected to be faster than other technology adoption, given the fast growing mobile phone penetration in the country.
Stuti Das
stutid@cybermedia.co.in
Source: Dataquest
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