Digital India - mPOS ( mobile point of sale) – Should it made compulsory for Indian Insurance Agents to carry it?

The success rate of insurance premium collections depend on the mode of the collection. Currently, the most popular mode of insurance premium collection is Cash or Cheques.

 Slowly but steadily insurance premium collection through eMode. The eMode channels are a) Net Banking b) NEFT c) RTGS d) IMPS e) POS Terminals at insurance company offices.

Not all insurance companies prefer eMode, as there is a direct transaction cost involved in completing the transaction. Hence, they still prefer traditional premium collection premium modes like cash or cheques.

 A detailed study between the traditional modes and eModes show that eModes are superior.

Benefit's of premium collection through eMode:-

    01)Immediate credit of the premium.

1. Offers end to end electronic tracking of the transaction.
2. Premium can be collected any time, any where.
3. Reduction of fraudulent log-ins especially during the end of the quarter/month.
4. Reduction of misappropriating cash premiums
5. Reduction in TAT of issuance of policies, where the premium is collected through cheque
6. No fear of cheque bounce i.e no need to issue provisional premium certificates.
7. No need to follow with the bankers for status of the outstation cheques.
8. Reduction of risk ratings of the policy holder.
9. Ease in checking the insurable interest of the payer.

Pain of premium collection through cash:-

a) Movement of physical cash from the collection point to the bank.

b) Reconciliation of balances between the collection point and the collection bank.

c) Replacement of mutiliated notes.
d) Replacement of suspected fraudulent notes.
e) High TAT to process cash transactions.
f) High carbon print to complete the cash processing cycle.

Pain of premium collection through cheques:-

1.  Movement of cheques from the collection point to the collecting bank.
2. Ensure that the cheque is not damaged during movement at various levels.
3. Ensure that the return cheque if any, is safely received and the provisional premium receipt is cancelled.
4. 1. Ensure that outstation cheques are collected without major delay.

Q) What is mPOS?

Ans: Searchcio defines mPOS ( mobile point of sale) as a smartphone, tablet or dedicated wireless device that performs the functions of a cash register or electronic point of sale terminal (POS terminal).

In India, during January 2013/ Reliance General Insurance, a subsidiary of Reliance Capital, launched a mobile point of sales (mPOS) solution. This mPOS solution is designed to allow customers to pay insurance premium using a mobile phone. The main objective of the company is to eliminate payment-related delays, errors and frauds with the launch of this service.

The company will provide an external card reader dongle that will convert any GPRS enabled touchscreen phone into a POS terminal.

The Reliance General Insurance Company (RGIC) agents will carry this mPOS device along with their GPRS enabled devices accept premium collection from the customer.

 

Developments in other countries:

Hungary: During the first week of March 2015, Hungarian insurance company Allianz Hungary chose Ingenico Mobile Solutions' mPOS to fully equip the 800 sales agents of its network. By end 2015 all sales agents of Allianz Hungary will have this mobile payment products in their hand. The main aim of this deployment of this mPOS platform is to enable Allianz Hungary commercial agents to secure insurance contract sales whatever the consumer's location, whenever they decide to subscribe for a service.

In India Allianz insurance has a tie-up with Bajaj Group and the company is known as Bajaj Allianz.

02) Italy: JUSP recently announced that it has just signed up one of the world's largest insurance companies so that the company's agents can use the JUSP chip-and-pin mPOS solution with customers. Following a pilot project, 3,000 insurance agents in Italy will be equipped with mPOS devices as they visit customers and will be able to sell and take credit card payments at a customer’s location.