Spice Money: Industry Monitoring 21June 2019
- Priyanka Kanodia
- Jul 8, 2019
- 4 min read
Spice Money
Competitors
Union Budget 2019: What Do Fintech Startups Want From The Upcoming Budget
Publication- Inc 42
Edition- Online
Date- 21 June, 2019
Fintech as an industry gained most of its popularity after the demonetisation move in November 2016, when the Indian government banned high-denomination notes. The initial growth wave led analysts to make high projections for fintech growth in different segments.
For instance, India’s premier trade body Nasscom estimated the Indian fintech software market to reach $2.4 Bn by 2020. Also, digital payments transaction value is expected to reach $135.2 Bn by 2023, according to an Assocham-PwC India study. Yet, the Indian fintech startups are still grappling for clear guidelines, incentivising tax reforms as well as clarity on the security infrastructure needed for around sustainable growth.
In its quest to be populist, the interim Union Budget of February 2019 didn’t address the specific needs of fintech startups. Akshay Mehrotra, cofounder and CEO EarlySalary believes the interim Union Budget 2019 was aimed largely at the middle-classes and the salaried section of the population, by offering tax relief through increasing income tax exemption levels. Anand Kumar Bajaj, founder and CEO, PayNearby chimed in with the importance of AePS devices, which allow citizens to easily access government DBTs.
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Industry News
India Post Payments Bank eying to be preferred gateway for govt subsidy transactions
Publication- The Financial Express
Edition- Online
Date- 21 June, 2019
To boost volumes for its payments business, India Post Payments Bank (IPPB) is demonstrating its last-mile reach through its massive network of access points so as to become the preferred banking partner for various subsidy transfers of central and state government schemes. The differentiated bank will soon also start cross-selling financial products such as mutual funds and insurance.
IPPB is working with the state governments of Karnataka, Maharashtra and a few in the North-East. “We are already doing POCs (proof of concepts) with state governments to demonstrate our last-mile reach where even banks find the going tough,” Suresh Sethi, CEO of IPPB, told FE. At the Centre, the differentiated bank has approached ministries such as that for rural development and is looking at schemes like MNREGA. “We have been able to structure couple of MOUs (memorandums of understanding),” Sethi added.
As per Reserve Bank of India guidelines, payments banks are not allowed to engage in lending activities and at least 75% of the deposits they receive is to be invested in government securities. The rest goes to demand and time deposits with other scheduled commercial banks, leaving little scope for generating revenues. The bank makes money by charging transaction fee from customers.
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Big Paytm push! Digital payments company to dole out incentives for kirana retail stores
Publication- Zee Business
Edition- Online
Date- 21 June, 2019
In a bid to penetrate the interiors of Indian territory, Paytm — a fintech firm that deals in digital payments — announced on Thursday its intent to push peer-to-peer UPI transactions to offline merchant payments at retail kirana stores. The fintech firm is looking to partner with over 20 million retail kirana stores, enabling them to accept all digital payment modes including UPI, wallet and cards.
Speaking on the move Deepak Abbot, Senior Vice President at Paytm said, "Paytm will invest money in offline merchant expansion instead of driving incentive led P2P transactions. Our offline merchants create high-frequency usage and an important use-case for Paytm consumers." UPI P2P payments are often done by users to gain some extra money. On Paytm, the UPI users are already the ones who have been using a large host of Paytm services for long and don`t require cash backs to make payments.
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PhonePe banks on trust
Publication- Fortune India
Edition- Online
Date- 21 June, 2019
The pivot towards creating a digital economy in India started circa 2014 with the likes of Paytm and MobiKwik launching digital wallets, where customers could store money and make payments for a host of utilities. These services gained rapid traction after the government banned high-value currency notes in November 2016. But they lost steam after the Unified Payments Interface (UPI) made it possible to directly transfer funds from one bank account to another at the tap of a smartphone screen.
Meanwhile, as mobile wallets reigned supreme, one company appeared to tread a different path since its inception in 2015 by shying away from wallets and focussing solely on UPIbased payments. Cut to 2019. PhonePe’s strategy appears to be paying off. The Bengaluru-based company, founded by three former Flipkart employees, is among the top three UPI-based payments companies in India, along with Google Pay and Paytm; in peer-to-merchant (P2M) payments, it is the largest. And from the looks of it, the company is just getting started.
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With NPCI tie-up, MeeSeva customers can now pay using UPI and RuPay cards
Publication- Medianama
Edition- Online
Date- 21 June, 2019
The National Payments Corporation of India has signed an agreement with the state government of Telangana to offer UPI, and RuPay debit and credit cards as payment options for users of the MeeSeva website, which offers various government services. NPCI, which runs the Unified Payments Interface (UPI) and RuPay, is also in the process of enabling a Quick Response (QR) code-enabled payment mechanism as an additional feature on the MeeSeva portal, which will be available both online and offline.
MeeSeva, a government of Telangana initiative, offers government-to-citizen and government-to-business services through its website. According to the website, MeeSeva offers 368 services across various departments including agriculture, Aadhaar, eKYC, healthcare, education, rural development, and social welfare. In a press release, MeeSeva claimed to have crossed 100 million transactions last year.
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