Friday, November 22, 2013

PayUPaisa Launches Release On Delivery (RoD) For E-Commerce Customers

PayU India’s online payment solution PayUPaisa has launched a new payment option called Release On Delivery (RoD) using which customers can release the payment for the product purchased online after receiving the product.

The company states that this option has been launched with the intent of  helping customers gain more trust on the merchants, while also helping merchants reduce the high transaction cost incurred through third-party Cash on Delivery (CoD) services. PayUPaisa claims that  the average cost per CoD transaction borne by a merchant is as high as 8% to 10% as compared to an online transaction which costs 2% to 2.5%. Therefore CoD continues to be a challenge although it constitutes 60% of the transactions done through e-commerce sites such as Myntra and FashionAndYou. It is worth noting that most e-commerce sites except Amazon have a minimum order value to provide CoD for transactions. Flipkart has limited the transaction value of CoD in Uttar Pradesh to Rs 10,000.

How does it work? During check-out, customers are shown multiple payment options such as credit card, debit card, netbanking or CoD to choose from.  On selecting CoD, RoD payment option is also offered to customers. On selecting RoD, payment can be made through credit card, debit card or netbanking. PayUPaisa releases the payment to the merchant either on receiving information from the buyer or by default after 3 days of product delivery.

RoD payupaisa

It is also worth noting that eBay already has a similar feature known as PaisaPay available on its website for its buyers and sellers to transact. However, on eBay, sellers are paid only during the next payment cycle and are charged at 4.5% + applicable taxes for processing the payment.

Launched in April 2013, PayUPaisa claims to offer free hosted web stores with services like email invoicing, easy website integration and free payment gateway, among others. In July 2013, the company had waived off its transaction discount charges (TDR) for both new and existing merchants until September 30, 2013. In September 2013, it had also launched an automated all-in-one-payment solution targeting e-commerce marketplaces and aggregators that operate in different segments like travel, real estate and collect fees or payments.

Other developments

In July 2013, e-commerce major Flipkart had launched its own online payment solution PayZippy. The company had also applied for a license to launch a a semi-closed prepaid wallet for consumers.
In June 2013, National Payments Corporation of India had launched an e-commerce solution called ‘RuPay PaySecure’. NPCI had partnered with an US-based online payment service provider Acculynk for this initiative.

TLabs incubated VA Tech Ventures Pvt Ltd. had also launched its operator agnostic prepaid mobile wallet, Happay that syncs with mobile number and SIM card to allow P2P and B2C transactions.
In February 2013, CCAvenue had also launched a free package for e-commerce websites that intend to use CC Avenue as their payment gateway. Few months later, it had also introduced an in-stream payment collection service for social networking websites called Social Networks In-stream Payments (SNIP).

Monday, November 11, 2013

Kangra Bank, Delhi on growth path with Rupay Card

The Kangra Co-operative Bank Limited, the largest Co-operative Bank of the NCTD , Delhi, held its 45th Annual General Body Meeting at FICCI Auditorium, New Delhi recently. Addressing the meeting the Chairman of the Bank Shri Laxmi Dass , who is also chairman of the Delhi Urban Co-operative Banks Federation , elucidated the growth of bank over the previous year.

Addressing the members at this occasion, Mr Dass said that the bank has shown remarkable progress compared to the average growth of banking industry. The bank continues to maintain the distinction of paying 18% dividend , the highest rate permitted as per DCS Rules -2007 , for the past 5 years and less than 1 % net NPA level for the past so many years.

Laxmi Dass said that the RBI has acceded to the request of the bank to open 2 more branches – With the opening of proposed branches, the bank’s branch network is expected to increase to 9 from the present 7 branches. The Kangra Bank would perhaps soon become the first coop urban bank in Delhi to launch ‘RuPay” ATM cards which would enable the customers to do their transactions from more than 1,00,000 ATMs of all the banks across the country.

The bank has already offering funds remittance facility through its own RTGS and NEFT system by which customers are able to transfer funds to any account/bank across country . The Bank has been awarded four times the ‘Best Cooperative Bank ‘ award by the office of RCS and Delhi State Cooperative Union. National Cooperative Union of India (NCUI) has also awarded the Bank for its outstanding performance at its 16th Indian Cooperative Congress held on June 25 & 26 , 2013.

Mr. A C Parmar , Managing Director & CEO of the Bank informed that in addition to this, RBI has granted permission for appointment of BCs/ BFs of the bank . Tender Notice for inviting best competitive offers from OEMs/ Authorised Agents / Eligible Bidders for installation of ATM Machines , appointment of BCs/BFs and providing of EFT Switch Services on shared basis has already been floated and process of selecting the right Vendors/ Parties would be completed by the Technology Development Committee of the bank very soon. He further said that ECS and SMS alert services have also been made available to the customers.
Parmar clarified that the RuPay ATM cards to be issued by the Bank to its customers can also be used as Debit Cards by which customers would be able to make payment for purchases made by them at merchant establishments anywhere in the country.

The Kangra Bank has also been discharging its Corporate Social Responsibility in a befitting manner . Shri B R Sharma , Ex-MD and present Chief Advisor & Professional Director of the Bank informed that the bank has been giving death grant to the family members of the deceased member of the Bank for the last 15 years which has now been increased to Rs.25,000/- w.e.f. 01.01.2014 .

Apart from this the bank has been giving one time cash scholarships and meritorious awards with certificate to the children of members and staff if he/she obtains 90% and above marks in the Board Examinations of 10th and 12th classes. The amount of meritorious award is Rs.3100/-for 10th class and Rs.5100/- for 12th class.
Shri Sharma further informed that the bank has also been paying monthly scholarship amount ranging from Rs.150/- p.m to Rs.250/-p.m. to the child of member / staff who have obtained 71% and above marks in 8th ,9th,10th and 11th classes . He said that the Bank has strong belief that recognition of brilliant students would definitely encourage them to play significant role in shaping the future of our country.

Mr Dass informed that the Bank has registered significant increase in the following segments.

20.26% in deposits
9.85% in loans and advances
13.41% in Income
8.24% in share money and general reserves
1.84% in membership strength
6.70% in Customers strength
7.68% in net worth of the Bank which is 47.58 crore as on 31.03.13

Tuesday, November 5, 2013

Rural banks asked to promote Rupay cards

The National Payments Corporation of India (NPCI) has pressed the Regional Rural Banks (RRBs) to promote RuPay cards to facilitate electronic payments and transactions among the people living in the remote rural parts.

A team of NPCI, the Central organisation mandated by RBI and Indian Banks Association (IBA) to build central infrastructure for payment systems like ATM switching, mobile payments, 24x7 remittance and financial inclusion transactions, visited Nuapada district and advised Utkal Gramin Bank to issue RuPay cards to their customers on a priority basis.

RuPay has been developed as an alternative to international payment gateways like VISA and Mastercard, providing lower costs and affordability along with protection of payment information related to Indian consumers.

It acts as a domestic open-loop system allowing Indian banks and financial institutions to participate in electronic payments, assistant manager, NPCI, Deepak Satpathy said.

Brand play in cards business - Rupay Card

While Visa and Mastercard slug it out for leadership, analysts say RuPay has the potential to cause disruption and eat into their market share.

Conventional wisdom says customers in India couldn't care less whether they have a Visa, Mastercard, or RuPay in their wallets as credit and debit cards are known more by the issuing banks than the card company. But the three big card brands obviously think otherwise.

While Visa continues to be the larger player in terms of market share, MasterCard is slowly, but surely, bridging the gap by offering additional features on the card.

So how do customers choose between a Visa or MasterCard? According to Nitish Asthana, Executive Director, First Data, ICICI Merchant Services, the affinity of the customer to the issuing bank plays an important role along with the credit limit, simplified applications process, offers, rewards and the reputation of service.

"Visa and MasterCard are well entrenched brands and widely accepted across all merchant outlets and e-commerce websites," he says.

Akhilesh Tuteja, partner and national head, IT Advisory, KPMG India says that both Mastercard and Visa enjoy similar brand value, though Visa is perceived to be a more popular brand than Mastercard because Visa has an aggressive marketing strategy and is seen more often.

"To the end customer, it does not matter whether they hold a Visa card or one from Mastercard because both are accepted at most and similar merchant establishments. Offers and reward points are the other important features of a card. However, these are mostly bank initiated and rarely payment gateway initiated," he says.

Visa is the first card that banks always start their card business with, says Uttam Nayak, Group Country Manager for India and South Asia, Visa. "We are leaders because from a bank's perspective our products are simple and easy to use. Our implementation and execution is robust and we have a developed a template for launches. We know what kind of operating process and IT infrastructure is required, how to write a policy document and our cards are easy to test at POS and ATMs", Nayak says.

If Visa was the first to offer Aadhar as an identity solution for e-KYC, MasterCard is not too far behind and is in the process of launching its own Aadhar linked solution, says Ari Sarker, Division President, South Asia. The gap between Visa and MasterCard is narrowing, he insists.

His claim is borne out by Hari Shenoy, Digital Marketing, brand-comm, who says, Visa leads as far as size is concerned, whilst MasterCard is reportedly accepted in more countries. Visa's network used to be larger previously, but now MasterCard's network is on par. When compared to advantages that a brand like Visa could have, it is increasingly getting narrowed.

"Increasingly, cards tailored for certain lifestyles attract consumers from that segment- eg, Airline co-branded cards that offer better travel rewards, shopping affinity cards, etc. Premium and platinum cards are on the rise," says Asthana of First Data.

Recognizing this, Visa has associations with Olympics and FIFA globally, since these bodies symbolise highest quality of skill sets, points out Nayak. In local markets, the association is with local properties. For instance, in India, Visa tied up with Sachin Tendulkar, way back in 1996.

"From a consumer's perspective, we have tie-ups that are relevant to them. The tie-up with Cafe Coffee Day to offer discounts at airport lounges for Infinite card holders and 10 per cent cash back for frequent flyers are some instance of this. Currently we are working on a platform for bill payments because people have to pay bills," Nayak says.

MasterCard is working on a contact-less card and a pilot project is expected to be launched late this year or early next year, Sarker says.

Apart from convenience and tie-ups, security is another area of concern for customers while choosing the card and both players are aware of this. Both of them offer the 'Zero-liability feature' in their cards, where in if the card is stolen or misplaced, the cardholder is not liable to pay for any transaction made on the card. "We realise that fraud is a big concern and we put customer at the centre of everything," Visa's Nayak says.
Another feature that Visa has introduced is Visa Risk Manager, which was introduced in 2011. This identifies a transaction that is not typical of the customers' transaction and blocks it. On its part, MasterCard has a similar feature, called MasterCard inControl. The technology allows cardholders to determine how, when and where a card may be used. Issuers can deliver real time information to cardholders and establish controls.

According to KPMG's Tuteja, Visa scores on dispute resolution because the process smoother. This also shows that Visa has made better investments in their back-end support system than Mastercard.
Queering the pitch for them could be RuPay, which has recently entered the e-commerce space and is part of the payment gateway options, making analysts bullish on its prospects. Shenoy agrees that RuPay has the potential to cause disruption and eat into Visa and MasterCard's market share. "Many nationalised banks, cooperative banks and a few private banks are part of the RuPay network. It has a lower transaction fees that will benefit banks as well", he says.

Loyalty programs will be key and will drive stickiness to merchants and banks alike. Customers are expected to seek value on the transaction experience, with features such as secure wallet and time of the transaction on the internet gaining more prominence in the decision.

SLUGGING IT OUT

Mastercard
• Plans a contact-less card, where you can tap and pay
• Will launch MasterCard inControl with cap on expenses
• Offers zero-liability feature in which transactions made through PoS will be covered

Visa
• Offers zero-liability feature
• Offers Visa Risk Manager -identifies transaction(s) that is not typical of a customer and blocks it
• Working on a platform for utility bill payments