Sunday, April 24, 2016

Winners of NPCI Unified Payment Interface (UPI) Hackathon

          The winners of Unified Payment Interface (UPI) Hackathonwere announced on April11th, 2016 at the launch function of UPI in Mumbai.

          The launch function was graced by Dr. Raghuram Rajan, Governor, Reserve Bank of India (RBI) along with Mr. Nandan Nilekani, Advisor to NPCI, Mr. Balachandran M., Chairman, Mr. A P Hota, MD & CEO and Mr. Dilip Asbe, COO, NPCI in Mumbai.

          The top five winners of the UPI Hackathon are Vsoft Nerds, CPay, Fundu, Ultra Cash, Enablers.

The UPI Hackathon platform provided for start-up/developer community to accelerate innovation in payments arena in association with Indian Software Product Industry Round Table (iSPIRT).
Brief details about Vsoft Nerds:
VSoft Nerds created the Jeb app which allows you to send and receive money. "This app is available in regional languages and enables quick response (QR) code payment. We are currently in talks with banks to offer this product," said Murthy Veeraghanta, chairman and chief executive officer, VSoft Technologies Pvt. Ltd.

Brief details about CPay:
2 member team of Winster Jose and Venkataswamy

Brief details about Enablers:
4 member team of Amritpal Singh, Varundeep Kaur, Ankur Sharma and Govind Paul
Project Synopsis
A Unipay enabler digitizing the payments with respect to Government Initiatives of Smart cities, Bharat Nirmaan, EBT transactions for all kind of institutions likes of Government Departments, Municipalities, NGO’s , MFI’s , Micro insurance providers, NBFC’s, BOA’s , Schools, Cooperative / Agriculture / Housing Societies etc by providing accountability and transparency for all payment transactions including C2C, G2C and C2G payments allowing disbursements, collections , transfers and utility payments leveraging UPI’s key concepts of Virtual payment address for ‘Pay’ and ‘Collect’ requests bringing inter-operability among all PSP’s.
Brief details about Fundu:
4 member’s team backed by Eko India Financial Services Private Limited.
Team Members are Gautam Chowdhary,Vivek Kumar, GAURAV MALIK, Nirmal Maheshwari

Brief details about Ultra Cash:
4 member’s team @ Raja Mohata,Vivek Srivastava, Anshuman Purushottam, Manas Kumar Mallik

Reference Documents
01) NPCI organises Unified Payment Interface (UPI) Hackathon

02) NPCI presents Unified Payments Interface (UPI) system

Wednesday, March 2, 2016

15 Opportunities for Safe Digital Transactions in India Budget 2016

          At the first glance, the below announcements in Shri Arun Jaitely’s Budget have a profound impact on the volumes of Safe Digital Transactions in India.

          The effects might not been visible in the short term, but will be visible in the medium-term to long-term.

Opportunity No 1: Unified Agriculture Marketing Scheme common e-market platform
Impact: All payments to the farmers will be routed through the Digital mode only. The payments may be directly to the farmer’s bank accounts or to linked mobile wallets. The mode of disbursement can be IMPS or NACH Credit platform. Splitting of credit by routing percentage wise to different recipients can also be explored.

Opportunity No 2: Crop Insurance Scheme, namely, Prime Minister Fasal Bima Yojana  
Impact: All payouts will be in digital mode only.

Opportunity No 3: Online Procurement System of farmer’s produce through the Food Corporation of India
Impact: All payouts will be in digital mode only.  NACH – EXCLUSIVE SESSION FOR PUNJAB GOVERNMENT TRANSACTIONS

Opportunity No 4:  Creation of 'E-Pashudhan Haat', an eMarket portal for connecting breeders and farmers
Impact: Participants will be encouraged in digital transactions only.

Opportunity No 5: Provision of Animal Health Cards ('Nakul Swasthya Patra')
Impact: Insurance policy details will be part of the Animal Health Cards. Premium collections and claims disbursements will be through digital transactions.

Opportunity No 6: 300 Rurban Clusters will be developed under the Shyama Prasad Mukherjee Rurban Mission.
Impact: Capsule programs on Safe Digital Transactions will be held to encourage rural folk to switch from physical to digital transactions.

Opportunity No 7: Two Schemes to promote digital literacy: National Digital Literacy Mission; and Digital Saksharta Abhiyan (DISHA).
Impact:  Launchof a  new Digital Literacy Mission Scheme for rural India to cover around 6 crore additional households within the next 3 years.

Opportunity No 8: New health protection scheme which will provide health cover up to Rs.One lakh per family. For senior citizens of age 60 years and above belonging to this category, an additional top-up package up to INR30,000 will be provided.
Impact: Premium collections and claims disbursements will be through digital transactions.

Opportunity No 9: "Stand Up India Scheme" to promote entrepreneurship among SC/ST and women. The Scheme will facilitate at least two such projects per bank branch, one for each category of entrepreneur. This will benefit at least 2.5 lakh entrepreneurs.
Impact: The selected entrepreneurs will be encourage to rely on “LessCash” modes rather than “Cash” modes.

Opportunity no 10: Digital Depository for School Leaving Certificates, College Degrees, Academic Awards and Mark sheets, on the pattern of a Securities Depository.
Impact: Need I say anything, the impact is clear.

Opportunity No 11: "Skill India" mission Pradhan Mantri Kaushal Vikas Yojana (PMKVY).
Impact: Participants of PMKVY across 1500m Multi Skill Training Institutes will be encouraged to explore “LessCash” modes rather than “Cash” modes.

Opportunity No 12: Entrepreneurs will be able to operate buses on various routes, subject to certain efficiency and safety norms.
Impact: Boost for ‘MORE’ – National Common Mobility Card. Reduction of income leakages.

Opportunity No 12: Action plan for revival of unserved and underserved airports.
Impact: Online ticketing companies can tap new routes and introduce the joy of air travel through discounts and CashBack offers. Boost to local tourism and hospitality industry. Medical tourism is also a viable option.

Opportunity NO 13: . The Pradhan Mantri Mudra Yojana (PMMY) Increase in target disbursement amount from INR1,00,000 crore to INR1,80,000 crore.
Impact: Loan Holders will be encouraged to opt for “LessCash” mode rather than “Cash” mode. 25% of the loan amount can be disbursed through Rupay Card.

Opportunity No 14: To provide better access to financial services, especially in rural areas, there will be a massive nationwide rollout of ATMs and Micro ATMs in Post Offices over the next three years.
Impact: Motivator for rural folk to route their transactions through Bank Accounts or linked Mobile Wallets.

Opportunity No 15:  Of the 5.35 lakh Fair Price Shops in the country, automation facilities will be provided in 3 lakh Fair Price Shops by March 2017.
Impact: The beneficiaries can buy the goods through Debit Cards linked to their bank accounts or mobile wallets.

          More opportunities will be added as and when understood.

Friday, February 26, 2016

Digital Transactions in India-Zip Zap Zoom

          This Press Release by Government of India has started to create waves in the financial industry across the world.

          The full rollout plan will be unveiled in the next couple of weeks. As of now this is only a ‘trailer’.

          In simple terms, the focus is on to reduce ‘cash transactions’, in India and promote Safe Payments through cards and digital means.

          A series of steps both short term and medium terms are in the pipeline. Short term steps will be implemented within one year. Medium term steps will be implemented within two years.

          These will be chiefly implemented by Government Ministries/ Departments/ Organisations. Private sector too will join in once the benefits are visible.

The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has given its approval for introduction of steps for promotion of payments through cards and digital means.

          Promotion of payments through cards and digital means will be instrumental in :-
  • reducing tax avoidance,
  • migration of Government payments and collections to cashless mode,
  • discourage transactions in cash by providing access to financial payment services to the citizens to conduct transactions through card/ digital means and
  • shifting payment ecosystem from cash dominated to non-cash/less cash payments.

The essential features of the proposals for promotion of payments through cards and digital means include

  • steps for withdrawal of surcharge/service charge/ convenience fee on card/ digital payments currently imposed by various Government Departments/organisations 
  • introduction of appropriate acceptance infrastructure in Government Departments/ organisations;
  • rationalization of Merchant Discount Rate (MDR) on card transactions
  • a differentiated MDR framework for some key transaction segments;
  • mandating payments beyond a prescribed threshold only in card/ digital mode;
  • introduction of formulae linked acceptance infrastructure by the stakeholders of certain card products;
  • rationalisation of telecom service charges for digital financial transactions;
  • promotion of mobile banking;
  • creation of necessary assurance mechanisms for quick resolution of fraudulent transactions
  • review the payments ecosystem in the country.

Now it is up to the various participants in the Digital Transactions arena to roll-out innovative, simple, safe, LessCost, low size, solutions to fast track the growth of digital transactions. 

          These guidelines will be beneficial to the upcoming Payment Banks and Small Finance Banks to roll out appropriate products from Day 1.

Saturday, February 13, 2016

1,000 crores market – Innovations in Traffic Violation Fines collections in India

          A 1,000 + crores market is waiting to be tapped by innovative service providers.  The size of this market is bound to increase in the coming months.

          Digital collection tools for Traffic Violation Fines are being introduced by many Sates across India.

          The traditional collection mechanism is through physical cash at the time on issuance of traffic fine challan.

          As the physical cash collection process was cumbersome with lots of paperwork, extra manpower and audit issues, Traffic Police teams started to look around for alternate collection mechanisms.

          In the erstwhile Andhra Pradesh, citizens could pay the traffic fine challan through the MeeSeva counters.

          Another new initiative is equipping Traffic Police teams with POS terminals for instant payment through debit or credit card.  This feature eliminates cash handling process. However, the main drawback is the convenience fees in addition to the traffic fine. This encourages cash transactions over digital transactions. Connectivity issues also lead to lower conversions.

          Traffic violation fines are under the jurisdiction of the respective States. However, all the states broadly follow the same rules.

          A couple of States have set their sights on NEFT.  The major advantages of NEFT for collection of traffic fines are:

a)     Offline transaction.
b)    150+ banks on NEFT platform.
c)     Easy to use.
d)    Transaction executed directly by the respective citizen.
e)    The traffic fine can be remitted by the person fined or any other person on his/her behalf.
f)     NIL Transaction charges (Majority banks in India offer free NEFT facility to their customers or with minimal service charges)
g)    Automated recon possible
h)    Differential pricing schemes possible i.e incentives for early payment, additional fines for delayed payments.
i)      Single Step or Dual Step options available.
j)     No need to expose the credit/debit cards details

Tips to encourage traffic fines collections through NEFT:-

1)     Graded traffic fines, 1st penalty INR xxx, 2nd repeat INRxxx+50, 3rd repeat INRxxx+100
2)    Incentives for early payment i.e INR 10 discount if paid within 24 hours, INR5 discount if paid within 72 hours. The incentive credited back through NEFT or donated to NGOs
3)    Sending banks not to charge service charges for remittances to selected IFSCs.
4)    Reward points for early payment of the traffic fine. These reward points to be transferable.

Tips to ensure 100% matching of transactions through NEFT:-
Technology requirement:

a)     2 or more Service Providers offering this service- end-to-end
b)    Setting up Messaging standards.
c)     Standardisation of Traffic Challans.
d)    Each generated challan to have a unique number. This unique number will be
e)    Standardisation of IT programs being used by the respective State Traffic police
f)     Beneficiary registration for this set of IFS Codes not to be mandatory in online banking portals.
g)    Transaction upper cap to prevent wrong transactions.
h)    Reversal within 12 hours, if NEFT transactions with invalid/incomplete details are executed.  

Third Party service provider:- Service Providers can be selected via the Tender method or Swiss challenge method.

Billing method:

1)     Per transaction
2)    Float model – Service Provider remits the collections after keeping the monies in the bank accounts, for 2 days, 3 days or more depending on individual agreements with the respective state governments.

Expectations from Service Providers:-
a)     Integrated call centre
b)    End to End recon
c)     Complaint management
d)    24*7 uptime

1)     Expand the scope of NEFT
2)    Enhance Safe Banking opportunities
3)    Reduced transaction cost
4)    Encourage transactions through banking channels
5)    Eliminate the need to carry bulky POS terminals
6)    Enhance overall fine collection                

Additional Reading material:
          Penalties under Motor Vehicle Act
          The Bengaluru police have a new problem on their hands. 
          Kerala Police tie up with BillDesk for online traffic violation fine payment
          Mumbai police allows payment of Traffic violation through NEFT
          Rs one lakh per hour: That's what police net as traffic fine in Bengaluru
Click it, check it, pay it... the fine guide
How do you pay your traffic fine?

Friday, February 5, 2016

The Aadhaar Digital Account-On the way

          By now majority of Indians are familiar with Aadhaar. Aadhaar has begun to permeate our daily life. In a typical day, we hear the word ‘Aadhaar’, at least once. The context may be financial or non-financial.
          As more and more sectors discover the benefits Aadhaar can provide to their daily routine, the word Aadhaar will be heard more and more.
          Not only in the Government sector but in the private sector numerous discussions are taking place on the immense possibilities of Aadhaar.
          In the next couple of years, Aadhaar Number Holders in India will be able to use Aadhaar for a number of non-financial authentication services.

Q: What is Aadhaar authentication?
Ans:Aadhaar authentication is the process wherein Aadhaar number, along with other attributes (demographic and/or biometrics and/or OTP) is submitted to UIDAI’s Central Identities Data Repository (CIDR) for verification; the CIDR verifies whether the data submitted matches the data available in CIDR and responds with a “yes/no”. No personal identity information is returned as part of the response.
Q: When do I need to authenticate?
Ans: Various service providers, such as PDS, NREGA, banks, are expected to link Aadhaar authentication to their services. Residents would need to authenticate either at the time of subscribing to the service or at the time of availing service delivery, as required by the service providers. This would benefit the residents as no one else can avail the benefits meant for a particular resident.
          Now, the most interesting part:::

Q: Is there a mechanism to notify the residents when an authentication occurs against their Aadhaar number?
Ans: UIDAI has an sms and email based notification mechanism. Through this mechanism, every time CIDR receives an authentication request against an Aadhaar number, a notification will be sent to the registered mobile / email address.
UIDAI will also provide a facility wherein residents can request the history of authentication requests for a specified period of time
Source: UIDAI Website
          The ANH need not be present at the authentication site, if the Biometric authentication method is not being used.
          The ANH may or may need not be present at the authentication site, if the OTP authentication method is being used. This is because the OTP will flow to the registered mobile number of the ANH and the mobile can be held by a non ANH too.
          The ANH need not be present at the authentication site, if the demographic authentication method is being used.
          Hence the need to quickly open up Aadhaar Digital Accounts. The ANHs need to have a record of all authentication requests on their Aadhaar Number. This ADA will act as an important verification mechanism in case of any disputes at a later date.
          It is expected that Aadhaar authentication services will be enabled only to registered agencies.       
Outline of ADA:-
01)  The Login ID would the Aadhaar Number itself.
02) Password can be static or dynamic. Static means the ANH will key in every time with his/her registered password. Dynamic means an OTP to the ANHs registered mobile in CIRD. For additional security the combination of static and dynamic too can be implemented.
03) All the authentications requests whether self-initiated or third-party initiated will be available.
04) The following data to be visible as part of the Authentication request:
A)   Mode
B)    Time
C)    Location
D)   Requestor
E)    Any other details as decided
05)  Print Option
06)  No Save option to external media



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