IT major Tech Mahindra today launched a new service ‘MoboMoney’ to cash in on the burgeoning digital payments ecosystem in India.
Tech Mahindra, which received a payment bank licence from RBI earlier this year, aims to get about 1 million merchants including kirana shop owners on board.
“Enabling digital payments in a country largely driven by cash presents a huge sociou2013economic opportunity to bring a positive change in the country’s financial system…
“…We have embarked on a journey to enable 1 million points of acceptance for MoboMoney over the next five years,” Tech Mahindra Chief Strategy and Marketing Officer, Head of Growth Factories Jagdish Mitra told reporters here.
MoboMoney is a prepaid wallet, issued in the form of an NFC (Near-Field Communication) contactless tag. It can be used to ‘Tap n Pay’ on a network of NFC-enabled merchant point-of-sale device.
Consumers can load their wallet by paying cash at the merchants as well as using their credit/debit cards and Internet banking. The money loaded to make over the counter payments, recharges, bill payments, as well as online purchases.
“Usage of cash is a huge drain on the Indian economy due to sheer cost of cash management logistics and risk associated with it. Key reasons for high level of cash spending have been lack of digital payment ecosystem, forcing people to withdraw cash. That is a problem that we want to address,” Mitra said.
According to reports, the total cost of storing, transporting and processing cash is about Rs 22,000 crore annually.
The company has run a pilot in Delhi-NCR comprising over 500 merchants.
“In the next one year, we will expand to the six large metros and neighbouring areas,” Mitra added.
Tech Mahindra, head-consumer businesses, Vivek Chandok said the company is targeting 90 per cent of the economy that transacts on cash instead of the 10 per cent which has access to the banking network.
Tech Mahindra has partnered with banks like Kotak and ICICI for the service, Mitra said.
In the last few months, a number of companies have launched their mobile wallets including Alibaba-backed Paytm (that claims to have over 100 million users) and Mobikwik (25 million users).
Recently, Tech Mahindra’s smaller rival, Nucleus Software had launched a similar but offline cash solution ‘PaySe’ to allow users to use digital currency.