Airtel has launched India’s first Payments Bank.
It is offering 7.25% interest rate, whereas normal banks offer 4%. Though this was only a pilot launch, but it has come at the right time and right place.
With Modi government demonetising Rs. 500 and Rs. 1000 notes, there has been a record 100% jump in Revenues of Wallet firms, such as PayTM, FreeCharge, etc. And, Airtel’s payments bank lunch could not have been any better time.
The other advantage that Airtel enjoys is that it will be able to leverage its extensive network of 1.5 million Airtel Stores across India.
The pilot launch has been done in Rajasthan. All Airtel branches in Rajasthan are now accepting opening of accounts, amount transfers, and all those transactions which Airtel has got license for.
Payments Bank was the brainchild of former RBI Governor Raghuram Rajan. He had come out with the concept of differentiated license for such banks.
The uniqueness of Airtel Payments Bank is that it will be completely paperless and digital. There will be no cheque books issued for doing transactions. The process of opening an account is completely through Aadhaar based eKYC.
The existing Airtel customers have an option of using their Airtel mobile number as their bank account with this Payments Bank. For them, all the banking transactions can be done using the USSD commands form their mobile.