Zero 2 Hundred-NPCIs Instant Payment Service trajectory in India

          A major milestone in India’s eTransactions journey was crossed in July 2015 with the total number of banks at 100 on NPCIs IMPS channel.

          Yes, as on date 100 banks are part of this 100% ‘Made In India’, eTransactions mode.

          The benefits of IMPS are being enjoyed by a large populace spread across the nook and corner of our country.

          The chief advantage of IMPS is that transactions can happen around the clock, irrespective of holidays, with nil dependence on bank staff.

          The initial transactions will be a bit strange, as the funds move at the speed of light at any point of time.

          There are number of channels through which the bank customers can choose to transact through the IMPS mode.

          There are a number of products which can be tailored by Finance Industry participants to enhance the customer experience.

          The technology is robust enough to support extremely high volumes at all times.

          Banks and PPIs are constantly innovating to expand the user base.

          Only a fraction of the target populace has been touched by IMPS and in the coming years, IMPS will embrace new group of people into its fold.

         

IMPS Card to scale up IMPS transactions 10 crs per month

          The transactions numbers of June and July 2015 is yet to be updated on the NPCI website. However, if past numbers are considered, the volumes are expected to show a sharp increase.

          The following are some disruptive strategies which can boost transactions volumes of IMPS.

No, the upper limit for individual transactions need not be increased. The primary key is to expand the foot print of the IMPS ecosystem.

On one hand Government is committed to eTransactions. At the same times, its flagship scheme i. e LPG Subsidy credit to bank accounts encourages cash transactions.

          Isn’t this a big contradiction? As the LPG subsidy is always directly credited to bank accounts, the gas consumers are already familiar with the banking channel. 

          This target audience does not require much motivation to migrate to eTransactions.

          Government departments channel the subsidy amounts to the respective beneficiaries, through NPCI. 

          On an average, NPCI undertakes around 3.5 million transfers through the platform every day, out of which most are LPG transfers.

Under the Pahal scheme of LPG subsidy, 139.1 million beneficiaries have received Rs.23,476.60 crore in their bank accounts since the scheme was relaunched. This translates the same amount of cash pushed into the economy.

As the LPG cylinder amount is below INR1000/-, banks end up large numbers of small denomination notes. The overall processing time of these large volumes is huge, both at the banks end as well the LPG dealers end.

This pool of beneficiaries is a low-picking fruit to be pushed towards eTransactions.

Introduce ‘IMPS Card’:

a)     An exclusive physical card

b)    Credits and debits through IMPS channel

c)     Debit upper limit of INR2000/-

d)    Contactless 

e)    No Pin. Only swipe and pay

f)     Linkages to bank accounts

g)    Linkages to eWallets

h)    Centralised clearing house to reduce transaction costs

i)      Centralised fraud monitoring system for robust monitoring mechanism

j)     No cash withdrawals

k)    Merchants can run common incentive programs

l)      Merchants can run exclusive incentive/referral programs

  

Based on feedback, will elaborate further