The Interbank Mobile Payment Service(IMPS) launched by National Payments Corporation of India (NPCI) in June 2010, received a boost as Citibank has introduced a new Cash Management Solution, around it.
The solution has been branded as Citi Cash-to-Mobile and it was launched last week, with a pilot in Hyderabad, Andhra Pradesh with the retailer's of Hindustan Coca-Cola Beverages Private Limited (HCCB), the bottling operation of the Coca-Cola Company in India, being the privileged lot.
The aim of this product is to completely automate the Receivables of a corporate, thereby freeing the company resources to concentrate on other activities.
Aimed at Corporate and Institutional clients, this market first solution empowers corporate customers to receive funds from retailers or end customers instantly via mobile.
As a Safe ePayments motivator, this new development is very exciting and the publicity surrounding this launch will now encourage more and more banking consumers, to experience the magic of IMPS.
Mobile Money Identifier (MMID) the seven digit random number issued by the bank upon registration for IMPS is a necessity for Citi Cash-to-Mobile to succeed.
The Process flow is as under:
01) The corporate opens a Banking Account with Citi and a MMID is issued to it.
02) The MMID is communicated to it’s distributions channel partners.
03) The distribution channel partners MMID’s are obtained and updated in the Bank’s as well as the Corporate’s Enterprise Resource Planning solution
04) On the payment due date, a SMS is flashed by the corporate, reminding it’s channel partners on the bill amount due.
05) The channel partners transfer the funds via IMPS module.
06) As the channel partners MMID is stored on the Enterprise Resource Planning solution, the reconciliation is done, and the MIS reports forwarded to all concerned.
06) As IMPS works 24 hours a day, seven days a week, the reconciliation can be done hourly, and the channel distributors be encouraged to remit money any time of the day or night.
07) The common excuse of ‘bank is closed’, will not be a show-stopper for Bill Payments.
Short term impact: -
a) 30 + Banks are on IMPS, but the remaining Banks have to enter the IMPS circuit, as otherwise the corporates might encourage their channel partners to move to banks offering IMPS.
b) Banks have to offer the complete suite of mobile banking services to enable its customers to obtain the full benefits of IMPS.
c) The CASA average balances at the Sending Bank and Receiving Bank, will increase as the Sender’s have to maintain adequate balance to transfer and the Receiver balance will go up correspondingly.
d) Banks too have to move to a 24*7 Core Banking Solution (CBS), as now funds can move in, move out 24*7.
e) The retail customers once are familiar with IMPS, will be encouraged to try out this channel for other payments/receivables too. This will provide the much needed jump for IMPS.
Security:
01) The Amount Limits are as under: -
With end to end encryption: A daily cap of Rs. 50,000 per customer per day for both, fund transfer and transactions involving purchase of goods and services
Without end to end encryption: Transactions up to Rs. 5,000 can be facilitated ( RBI Circular Dated May 4, 2011 2011 RBI/2010 RBI/2010--11/511 11/511 DPSS.CO.No.2502 DPSS.CO.No.2502 /02.23.02/ /02.23.02/ 2010 2010--11)
02) The funds cannot be transferred without a MMID.And, a MMID is attached to a Bank Account. Hence the chance of fraud is low.
Thanks to Citi, for being the first bank to introduce a Solution around IMPS. Now, there is no stopping for IMPS.
The possibilities are endless. Which will the next Bank to tap IMPS innovatively?
Let me end today’s Post with a quote : -
"It's easy to come up with new ideas; the hard part is letting go of what worked for you two years ago, but will soon be out of date."
— Roger von Oech
