ICICI Bank’s Pockets app has been downloaded by five million users within a year of its launch. What’s more, 80% of these customers had no prior banking relationship with the lender. Abonty Banerjee, head—digital channels, tells Shritama Bose that Pockets will usher in a lot more innovations in the payments game as it strives to be a full-fledged open-architecture payments platform. Excerpts:
What did you hope to achieve with Pockets?
We thought of it as a digital bank for the mobile-first generation, an instant product that would activate them on digital channels without a visit to the bank. You can open a Pockets wallet account in a few seconds and upgrade later to a full-fledged bank account. So the idea was to give the customer the service of a full-fledged bank instantly, as also a non-banking experience to enable transactions sucha as movies and gifting that are fairly frequent. We felt this would really work for a generation that is becoming mobile-centric.
We have added a lot since then to make it a full-fledged open-architecture payments platform. Today the customer can actually perform through it a host of payment transactions, regardless of the platform she wants to use—UPI, the wallet itself, the bank, a physical card or QR.
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What kind of growth in usage has the app seen since its launch?
We don’t really publish data on transactions pertaining to each of our applications. If you look at mobile banking transactions as a whole, we were market leaders last year and overall, as a bank, we do mobile transactions worth close to R30,000 crore . The important point here is that 80% of our customers are new to the bank, which is what we wanted.
How has the launch of the UPI affected the usage of the app and digital banking in general?
We always wanted Pockets to embrace all open-architecture payment platforms. We were one of the first banks to launch UPI on our app and both ICICI Bank and non- ICICI Bank customers were able to link their accounts and pay through the UPI ID or UPI QR code. We were also the first to launch mVisa as a product and, again, one of the first banks globally to launch HCE (host card emulation) as a product, which is an NFC (near field communication) or touch-and-pay concept. Our thinking has been that Pockets should make available to the customer any open-architecture payment platform that is interoperable.
UPI is one such platform and we are very happy to be one of the first banks to have integrated UPI into Pockets. This has only increased interoperability. Since 80% of the customers are not ICICI Bank customers, UPI has helped them link the other bank accounts and initiate payments through the application. We believe that these transactions will only grow. We’ve also launched the interoperable QR code, which is called BharatQR. We believe that QR as a paying mechanism will also grow in India and, therefore, we see Pockets hosting all of these as a platform.
NFC-based payments have not really taken off in India. What’s the reason for that and how can it be changed?
The inflection point for a payment architecture will be reached when there is both issuance and acceptance. In terms of issuance, we have seen most of the major banks start in a big way. We have gone a step forward and not only done an NFC physical card, but also NFC on mobile, which very few banks have done. But, on the other side of the growth story are factors like the growth of terminals and, therefore, acceptance as such. If you look at acceptance, many of the new terminals are NFC-enabled and more and more phones are becoming NFC-enabled in India. There will come an inflection point and the infrastructure is getting built around it. As all major issuance players participate and acceptance grows, we will see that sudden growth happen. NFC will be there in the long term.
Non-bank issuers of wallets had a first-mover advantage. To what extent have banks managed to close the gap?
The wallet players do one part of what banks do, which is offer a few payment services. For a customer, the relationship with a bank is far more comprehensive because in the financial journey, the bank comes in at every step. We don’t look at it as a bank versus a wallet kind of thing. As part of an overall engagement with the customer, payments is one thing we do and in that, we believe, we are on a par with, or even better in many cases, than non-banks in terms of experience.