Mobile Money Services is the much talked about Nokia Money Project that was approved by RBI few days back. Officially launched by Yes Bank, powered by Nokia and Obopay, this service is one of the first end to end solutions in mobile banking.
Previous offerings almost always addressed a slice of the pie and never had tie-ups with the biggies – namely the phone companies and the banks. Though there was Airtel Mobile Money Transfer but it was only an extension of mChek. This one however is a step in the right direction. The money part is controlled by Yes Bank, Nokia provides its retail chain for better reach and Obopay is the technology provider.
They provide two kinds of accounts on the basis of your usage. The first called “Easy pay” is for basic services like recharging the phone account and paying utility bills (do recall that most banks like Yes bank provide utility services already – so this is just plugging tino existing systems – through the phone). The second one called “Easy Send” however is more interesting. This allows you to send money to recipients who also have a similar account (either of the above). This is an interesting solution as it would enable transfer of money from a mobile to another mobile hopefully without much of a time lag etc. We would think transferring to any account would be the next logical step – and it should not be a big deal.
How to Register for Mobile Money Services:
1. To register for the service visit a Mobile Money Agent who essentially will be your Authorised Nokia Dealer.
2. Fill up a basic form with Photo ID proof.
3. Deposit Money with the agent to get started. You do not get interest on the money deposited. It will be maintained as Savings account or Prepaid account by Yes Bank.
Registration is Free. Service currently available in Pune only.
How to Access: The service is currently accessible through Mobile app on certain Nokia handsets only. But it will be soon opening up on SMS(full service), GPRS (full service) and IVR(for balance check only) and will not be limited to Nokia users. Your mobile number defines your account and has a security pin associated with it. While changing number you can transfer your existing account to new number.
Types of Accounts
1. Easy Pay (No service fee)- Use it for paying utility bills.
2. Easy Send (Service fee involved)- All EasyPay services along with option to send money to other users and merchants. Since money transfer between individuals is involved here, you need to register with with address proof at a Yes Bank branch.
The most important aspect is the one which is “coming soon”. One of the promises on the site is shopping – using just the mobile phone. We would be VERY interested to see how that pans out. That will be the true “last mile” solution which links a payment system with a bank account with the device. It will also be a big test as they most probably will have to work with existing systems and therefore have to tie-up with other bank gateways (e.g. the credit card machine you use at a shop might be owned by another bank). They might alternately go the route of installing this on every shop owner’s phone – but that might be a cumbersome process and one which is difficult to implement.
The service is currently launched (pilot) in Pune as it is a potent market owing to the density of tech savvy users. Although the utility services part is a major attraction for urban crowd i truly believe the P2P money transfer service will be embraced by the rural population at large. There is a huge money transfer industry that currently serves the un-banked immigrant workers in big cities who want to send money back to their villages. The prevailing service charge for such transfer is anything between 2-5% of the total amount, so one can well imagine the need for a cheaper service. Nokia’s presence is pan India including small towns so even at 2% transfer fee it will find users for micro transfer. Though for now the withdrawal facilities are at Yes Bank branches only.
Beam is another service that was launched to serve the same need. While Nokia is betting on its retail network for the last mile reach, Beam had started recruiting rural youth as sales agents. Definitely, Nokia’s agents enjoy a better trust and reach as of now. Also while Beam was always said to be targeted at rural population, the aggressive TV promotion is aimed at a completely different audience. Confused positioning?
We think the biggest roadblock in terms of mobile banking in India is not really technology. The single biggest inhibitor are the rules surrounding exchange of money and “banking”. RBI is looking into watertight mechanisms which will enable mobile banking in the earnest and also take care of loopholes like hawala etc. This experiment by Nokia could be the trendsetter and in many senses the pathbreaker in mobile banking in India. It could be a game changer in utility payment services, tapping the un-banked population for money transfers and micro-credit disbursement in future. It has all the elements needed for being successful – the adoption is going to have the final say though. What do you think? Is the time in India ripe for this? What do you think are the roadblocks / inhibitors to adoption?
[Co-authored by Pratyush Prasanna]
[Naman is a startup enthusiast and has worked with couple of Indian startups as Product Manager. He writes at The Inspire Blog]