Showing posts with label ap hota. Show all posts
Showing posts with label ap hota. Show all posts

Tuesday, February 9, 2016

NPCI aims at financial inclusion: Rupay Card News



Aiming at financial inclusion for all with India's domestic card service RuPay, the National Payments Corporation of India (NPCI) said that as many as 170 million of its 230 million customer base were first-time card users.



"We already have as many as 596 members who are in the RuPay network, including national, international and state cooperative banks. We are now trying to get the district central cooperative banks (DCCB) also in the fold," says A P Hota, managing director and CEO of NPCI.



RuPay also helps curb forex loss. For every transaction involving foreign card providers like Visa, MasterCard, American Express, there is the transaction fee on it going out of the country - an estimated 400 crore annually. "With a domestic card service system, there is a tremendous amount of money that India can retain," says M Balachandran, chairman, NPCI.



Another advantage with using RuPay over international card providers for a consumer is when it comes to the merchant discount rate (MDR) - the rate charged by banks providing debit and credit card services to merchants. So normally a food bill of Rs 2,000 or a saree purchase of Rs 4,000 will result in a Rs 20-Rs 40 deducted as MDR.



"With RuPay, the advantage is that we charge a fixed rate. We charge 60 paise on the acquirer bank and 30 paise on the issuer bank - amounting to 90 paise per transaction. Normally debit card interchange is anywhere between 0.65 to 1%. Credit card interchanges could be 1%-2%. So with RuPay, there is lower costs to merchants, which is passed onto the card holder," says NPCI's Hota.



RuPay also has RuPay Platinum and RuPay international, in partnership with Diners' Club and Discover Financial Services, that aims at catering to a wider audience. NPCI plans to launch RuPay credit cards by June.

RuPay cards gaining currency among the poor


More than half the 20.19 crore people who have opened basic bank accounts under the Prime Minister Jan Dhan Yojana have activated their RuPay cards and are using them regularly.
About 90 million RuPay cards – envisaged as a home-grown debit card for the economically weaker sections – are being used in the interoperable system of ATM network facilitated by the National Financial Switch alone, “which is a significant indicator for transactions in these accounts,” AP Hota, Managing Director and Chief Executive Officer, National Payments Corporation of India (NPCI), told BusinessLine.
So far, 170 million cards have been issued to all eligible accountholders. If one also includes use of RuPay cards in their own bank ATMs, the number of active cards in use will cross 100 million. “The combined number of cards in use could be much higher,” Hota said.
The number of RuPay transactions, too, has been increasing steadily. For example, from 20 lakh transactions a day about two-and-a-half months ago, the number has gone up to about 27 lakh, according to NPCI data. The average transaction value is about ₹2,000.
In the last three months, about three crore new accounts were added across the country.
Government data show that the as on January 13, the total balance in these accounts has crossed ₹30,000 crore.
According to a senior executive of State Bank of India, while banks have almost stopped campaigns for new enrolments, people continue to open accounts voluntarily.
Key impetus

New account enrolments are being spurred by, among other reasons, the increasing awareness about the social security cover that accountholders get.
Under the scheme, the RuPay card comes with an inbuilt accident insurance cover of ₹1 lakh for up to 90 days after the cardholder carries out a successful financial or non-financial transaction at a merchant establishment, an ATM or an e-commerce platform.

Friday, June 12, 2015

‘55% of RuPay cards active under Jan Dhan Yojna’

 AP HOTA, MD and CEO of NPCI

Exploring the feasibility of networking with China, says NPCI chief

As India’s own card-payment scheme RuPay aims to go global, National Payments Corporation of India (NPCI), which conceived and launched the scheme, has tied up with Chinese and Japanese companies to help citizens of these countries use Indian ATMs and Point-of-Sale terminals. AP Hota, Managing Director and CEO of NPCI, says the corporation plans to take this one-way relationship further and bring more activity into the home-grown card network. Edited excerpts from an interview:

How will the tie-up with China UnionPay International be beneficial?
We are exploring the feasibility of network-to-network relationship with China. Initially, the relationship will be one-way, that is, China’s UnionPay card-holder when they come to India can use Indian PoS terminals and ATMs. Currently, all the ATMs and 99 per cent of PoS terminals are part of NPCI.
Next, we will look at commercial arrangements between NPCI and China Union. They will have their approval and we will now seek approval from our member-banks and we can expect this in the next two months.
Later, the technical integration will be done and, in anticipation, we have already started the process. We may look at going the other way later — that is, our card-holders can use ATMs and PoS terminals in China.

What is the status on cards under Jan Dhan Yojna? How many are active?
Over 130 million cards (13.7 crore according to the Pradhan Mantri Jan Dhan Yojna website) have been dispatched as on April-end. According to Finance Ministry data, 55 per cent of the 140 million cards issued under Jan Dhan are active, though previously it was 70 per cent. However, we are hopeful that once MNREGA is implemented, the level of inactive accounts will come down. Direct Benefits Transfer (DBT) has also helped in making them active.

The RBI has said it will roll out guidelines for issuing mobility cards. When will they be launched?
We are working with the Ministry of Transport to make payments easier in smart cities by issuing mobility cards. We have built the specifications based on both national and international standards.
This will facilitate usage of the cards at grocery shops or while buying tickets for any mode of transport through the contact-less system.
Also, the requirement of contact-less transactions will be huge and procuring large terminals in accordance with Indian standards will also serve the ‘Make in India’ campaign. We have made several presentations and the Ministry is examining our specifications. 

Will you be using the same debit cards?
Yes, it will have to be EMV (Europay, MasterCard, and Visa) enabled and have NFC (near field communication) technology. From September onwards, we will have to issue EMV-based cards as per RBI mandate.
It will be a challenge to replace the existing Jan Dhan Yojna cards into EMV-enabled ones. As of now, the RBI has not given any deadline on the replacement.

Sunday, October 26, 2014

Amazon shopping, Jet Airways booking now easy via RuPay Card


NPCI has already issued more than 30 million RuPay cards.
After Flipkart, home-grown payments gateway RuPay has tied up with Amazon and one of the largest carriers Jet Airways.

With this, the RuPay debit card holders can now shop best deals on Amazon and book air tickets on Jet Airways, the Reserve Bank-promoted National Payment Corporation which issues the RuPay cards said in a statement today.

"Acceptance on Amazon is a breakthrough for us. We are glad to offer a wider horizon to our cardholders to transact online. Also, our integration with Jet Airways will definitely benefit our cardholders,," says NPCI managing director AP Hota said.

Commenting on the tie-up, Amazon India general manager for payments Srinivas Rao said, the arrangement is in line with its strategy of offering the widest set of customers a variety of payment options that will enhance their shopping experience.

The NPCI had last week announced that it has tied up with Flipkart, Snapdeal and LIC who are among over 15,000 merchants who will be accepting the RuPay cards, which are the homegrown alternative to foreign gateways like Visa and MasterCard.

Following the tie-up Jet Airways has begun accepting RuPay cards on their site for air-ticketing, airlines’ senior vice-president Gaurang Shetty said.

NPCI has already issued more than 30 million RuPay cards, which are accepted at all ATMs, and by 9.8 lakhs POS terminals and over 15000 online merchants.

The domestic online retail industry, as per a Crisil report, is expected to touch Rs 50,400 crore by FY16 from Rs 1,500 crore in FY08.

According to online industry body IAMAI, travel has emerged out as the most transacted segment in the online space accounting for 60 percent of online payments. The value of online payments for travel industry stood at Rs 50,000 crore in FY13.

Sunday, October 19, 2014

RuPay cards to boost e-commerce, says SBI

RuPay e-Commerce has roped in big online merchants such as IRCTC, Life Insurance Corporation (LIC), Flipkart and Snapdeal to facilitate online payments. 

RuPay cards’ acceptance has grown to over 15,000 online merchants with having a customer base of 30 million RuPay cards that are acceptable at all ATMs and 9.8 lakh PoS (point of sale) and over 15000 online merchants in the country, said RuPay in a statement. 

With this arrangement, RuPay card holders can book train tickets on irctc.co.in, make online payments for LIC premium, shop on Flipkart.com, Snapdeal.com, Homeshop18.com and book movie tickets on Bookmyshow.com. Also, the country’s largest bank- State Bank of India (SBI) has started accepting RuPay cards on its payment gateway. RuPay e-Commerce service was launched in June 2013 with an additional anti-phishing feature for security checks, the statement 

“Team-SBI is quite upbeat about the development. State Bank Payment Gateway (PG) facilitates every month, around 1.3 crore Card-Not-Present (CNP) transactions. Addition of RuPay platform will give a further boost to e-commerce transactions. Flipkart is one of our active merchants. Acceptance of RuPay Card for online transactions by Flipkart will add to the transaction flow from their site to our NetBanking and PG”, said B Sriram, Managing Director at SBI. 

Sachin Bansal, Co-founder and CEO, Flipkart, said “Payments is a core area of focus for Flipkart. We are constantly looking for ways to expand and improve the payments experience on our site and this initiative with RuPay is an important step in that direction. We look forward to working with SBI and NPCI on more such initiatives that will contribute towards enhancing the payments ecosystem for our customers”. 

RuPay scheme aims at addressing the needs of Indian consumer, merchants and banks with benefits attached to it including - lower cost, customized product offering, protection of information related to Indian consumers, electronic product options as relevant to untapped/unexplored consumer segments and Inter-operability between payment channels and products. 

A P Hota, MD and CEO, NPCI said, “Acceptance on large merchants like IRCTC, LIC, Flipkart, Homeshop18, Snapdeal and BookMyShow among others marks an important milestone for RuPay ecommerce. Today, 30 million RuPay cards have already been issued in the country. RuPay cards today are enabled at all ATMs across the country, 9.8 Lakhs POS terminals and over 15000 online merchants. It is our vision to touch every Indian with at least one payment mode of NPCI by 2020”
NPCI offers e-commerce solution PaySecure, through which a RuPay cardholder uses ATM PIN to make an online transaction which is easy and quick.

Monday, September 22, 2014

'Jan Dhan' Scheme: National Payment Corp Scrambles to Issue RuPay Cards

'Jan Dhan' Scheme: National Payment Corp Scrambles to Issue RuPay CardsAlthough close to 4 crore bank accounts have been opened under the Jan Dhan Yojana so far, there is a huge backlog in the issuance of the Rupay cards by the National Payment Corporation of India (NPCI), the sole issuer of ATM cards for these new accounts.

Over the weekend, Financial Services Secretary G S Sandhu had said that banks had opened 4 crore accounts so far and mobilised about Rs. 3,700 crore as deposits in these accounts.

"Although the number of accounts opened are very high, about 20 lakh (RuPay) cards have been issued so far," National Payment Corporation of India (NPCI) managing director and chief executive A P Hota told PTI.

There is a lag in production of cards which usually requires three weeks to get cleared, according to Mr Hota.

"Personalisation (of cards) takes time because the name has to be embossed on the card. This is such a big order coming all of a sudden. Nobody expected that in one go so many accounts will be opened," he said.

However, he said the backlogs are likely to be cleared in next three weeks.

The scheme was launched by Prime Minister Narendra Modi on August 28 with an aim to boost financial inclusion.

Under the Jan Dhan scheme, account holders will get an overdraft facility of Rs. 5,000. They would also be provided with RuPay debit cards and Rs. 1 lakh accident insurance cover.
The government has envisaged to provide bank accounts to 7.5 crore people by January 26.

Monday, September 8, 2014

Jan Dhan Yojana opens a new door for RuPay gateway

 

As Pradhan Mantri Jan-Dhan Yojana (PMJDY), the financial inclusion scheme launched by Prime Minister Narendra Modi late last month notches up impressive numbers and expects to meet its 7.5 crore accounts target well within 100 days, payment gateway RuPay is experiencing a boost in fortunes. 

Payment gateways are platforms that help banks facilitate electronic money transfers. India is only the fourth country in the world after the US, Japan and China to have its own national payment gateway, in RuPay. 

With the PMJDY getting nearly 2.5 crore new bank accounts within seven days of launch, each account holder gets a RuPay debit card along with his/her account.As a result, RuPay is notching up numbers. 

Fast-growing base

According to the National Payments Corporation of India (NPCI), which developed the platform, the RuPay card has a current base of 2.5 crore users and is seeing about seven lakh inter-bank transactions a day. 

With the financial inclusion scheme coming into play, the total number of RuPay card holders is likely to surge. NPCI will declare official numbers at the end of this quarter. 

AP Hota, Managing Director and CEO of National Payments Corporation of India Ltd (NPCI), told BusinessLine that the target for the year-end was six crore cards. By March 2015, RuPay may be able to add an additional 10 crore accounts. If the Centre’s financial inclusion scheme lives up to its hype, the sheer number of RuPay cards in the country will create a critical mass that will help create a huge network of retailers who accept RuPay cards. According to Reserve Bank of India statistics, the total number of credit cards in India is currently at around 1.9 crore while the number of debit cards issued is at 40 crore. Currently, global organisations such as Visa and MasterCard dominate this space. But Hota says competing with MasterCard and Visa is not a priority. “The perceived competition with MasterCard and Visa is not relevant at this stage. They are global companies with trillion-dollar revenues and deep pockets. We are a small company with ₹100-crore capital,” he said. 

Main challenges
The main challenges for RuPay are to get acceptance among the high-income bracket and to increase the number of transactions among those in the lower income bracket. Partner banks have an incentive to push RuPay to customers as transaction costs through this gateway are expected to be at least 40 per cent lower than through Visa and MasterCard.

Monday, July 7, 2014

Government asks PSU banks to issue RuPay debit cards to customers, install POS terminals



For the first time in their 30-year existence, Visa and MasterCard, the world's largest payment companies, are facing the heat in India. Lending its weight behind the local card scheme, RuPay, the government has asked state-owned banks to issue RuPay debit cards to customers.

In a communique to banks last week, Gurdial Singh Sandhu, secretary at the finance ministry's department of financial services, "urged" CEOs of public sector banks to issue RuPay cards to all existing customers who do not have debit cards as well as to new clients. Banks have also been told to "encourage" merchant establishments to install point of sale terminals for RuPay cards, two banking sources told ET.

While banks have not been instructed to refrain from issuing cards where transactions are processed by Visa or MasterCard, there is a clear direction to promote RuPay. Customers are typically issued a single debit card per account and banks will have to pursue the unconventional practice and possibly tweak systems to issue two debit cards to a client who insists on a Visa or MasterCard that currently have greater acceptance than RuPay.

RuPay was launched by National Payments Corp of India (NPCI), set up to function as a cost-effective payment services entity. Responding to ET's query on whether PSU banks could lose rich and more brand-conscious customers to private banks (which have not received a similar direction from the finance ministry), AP Hota, MD & CEO of NPCI, said, "Such fears are unfounded. RuPay is a fully functional card payment system. We are also launching Platinum cards for HNI customers."



 "I'm not aware of the ministry's communication to banks. But as I understand, the government's focus is to promote financial inclusion," said Hota of NPCI.

For banks, it's a mandate they will have to fulfil. Within the next six months they will have to offer the new debit card to existing customers, inform thousands of branches and submit progress report to the ministry every quarter.

It's not unusual for countries and governments to support local retail payment networks that offer the software backbone and process card transactions. Countries such as Singapore and Brazil have their local payment companies while China disallows foreign payment firms to process domestic card transactions. But industry sources said an absence of a level playing field may worry global players such as Visa and MasterCard.

For MNC payment firms, the stakes are high. Every year around Rs 80,000 crore worth of debit card spends happen in India, of which 5% are cross-border transactions. It's a market that's growing at close to 35% annually. Credit card transactions, growing at over 25%, are more than two times debit card spends.

Asked whether RuPay would be accepted for transactions such as buying books and music on international e-commerce sites, Hota said NPCI was tying up with the US firm Discover Financial Services to promote co-branded cards to facilitate international transactions.


The fledging card scheme is trying to spread its footprint. So far,A 20 million cards have been issued. "It has full acceptance in ATMs, and of the 10.35 lakh POS (point of sale) terminals in the country, RuPay can be accepted in 9.87 lakh terminals. About 95% of debit card transactions are domestic in nature," said SK Gupta, chief project officer, RuPay. But not all merchant establishments are familiar with RuPay and few display RuPay stickers (along with Visa and MasterCard) on their counters. Till now, POS transactions worth Rs 40 crore have happened through RuPay.

Sunday, June 8, 2014

Except one, no pvt banks have issued RuPay cards: A P Hota

A P HotaRupay the country’s first online payment gateway, was launched by National Payments Corporation of India to compete with American multinationals Visa and Mastercard. It has not found takers in the private banking space. A P Hota, managing director and chief executive officer, says plans to take the card abroad have also been hit by cost considerations. Edited excerpts of a talk with Nupur Anand:

The offtake for RuPay cards in certain channels is still low. Why?

The RuPay gateway has just started and the card base is only 15 million. Plus, for the card to pick up in various channels, all banks will have to start making changes in the system such as in e-commerce, etc. Also, banks will have to start issuing the cards. Of the only 15 million cards now, most have been issued by public sector banks (PSBs). Not a single PSB has, except Federal Bank.

By when do you see private banks getting in and issuing cards?

Nor for the next year or so. They are catering to one particular segment, of international cards. We are in the domestic space. Many private banks are tied in a long-duration contract with Visa and Mastercard. Until that expires, they will not be able to come out of it. They have taken money from them in advance. If they have a third card base, they will not be able to issue the committed number. Many of the PSBs have not taken such a long-term contract and it was easy for them to come on board, such as Punjab National Bank, Union Bank, Canara Bank, etc. Some banks also have technological challenges.

Private and foreign banks don’t really have any technological challenges.

True but some only see the short-term interest.

Have the bigger PSBs such as SBI also started issuing RuPay cards?

SBI started about two months earlier. They'd also taken money for a long-duration contract; they're now taking a bit of a risk. They are saying it is worth paying back the money to Mastercard and Visa, as they will also be saving a lot of money with RuPay — the cost of these cards is a third compared to the multinational counterparts. See, all the fees that banks in India pay are in dollar terms. SBI has a 180-mn card base, so they are paying a lot in fees. Even if no other bank comes in but SBI fully does, the scheme is a success.

You had also tied up with Discover Financial Services to take RuPay international. What is the progress there?

Technically, we are ready. But the commercial rates are yet to be decided. The idea is to make it more attractive than MasterCard or Visa. In the domestic market, the cost is a third but in the international market, we are finding it difficult to price it accordingly.

Our volume is low as we are not in the credit card market. We're only in the debit card market and the bulk of transactions internationally happen in credit cards. So, other players can leverage it, while we can’t. It is also difficult to determine the rates of the two international players, as they have different rates for different banks.