NEW DELHI: Airtel, ICICI Bank and VISA have joined hands to launch mChq, the first mobile-to-mobile payment option in the country, which enables Airtel customers and ICIC Bank Visa cardholders to pay for their purchases using Airtel mobile phones.

The transaction process is one where the retailer/merchant sends an SMS mentioning the amount to the customer. The customer enters his/her personalized PIN number and sends an SMS back to the retailer acknowledging the amount to be paid. Both the parties then get a confirmatory SMS indicating the completion of the transaction.

Airtel customers subscribing to this service will be issued a new SIM card free of cost while ICICI Bank cardholders will be issued an Add-On card on the basis of their existing ICICI Bank - Visa credit card.

There is a monthly fee of Rs 10 for using this service, which would be added in the monthly credit card bill of the customer. There would also be a SMS charge for the transaction over and above the normal rate of transaction levied upon the use of credit cards.

Mumbai-based technology partner of Airtel, A.Little.World, powers the mChq technology. IRDBT (technology arm of RBI) is the root key management (KMA) for mChq and the principal certification authority (CA) for use of public key infrastructure in mChq.

In the first phase, this service would be available to Airtel and ICICI Bank customers in Delhi NCR and Mumbai across 100 retail outlets, including departmental stores, restaurants and bookshops.

“In the second phase, the service would be extended to around 500+ outlets in the two cities, while the third phase would entail the expansion of the service in top 10 Indian cities and beyond,” said Airtel senior VP (new products & alliance) Mohit Bhatnagar.

Speaking on the occasion, ICICI Bank executive director Chanda Kochhar said that this service is going to revolutionize the payment industry. Giving the rationale behind launching this, she said, “According to statistics, card transactions only 1.8 percent of the total per capita income of India. We are targeting the rest of the cash/cheque base of 98 percent to migrate to this new service. Also the potential of adding more applications is huge. The service is also expected to revolutionize the entire merchant acquiring side in India.”

In future, the service is expected to expand to remote payments like electricity bill, home delivery, utility bills, etc.