KOLKATA: Vodafone, the telecoms company, is partnering with ICICI Bank to launch the M-Pesa service in India, as it seeks to tap the growing market for mobile banking and mcommerce.
M-Pesa, which has been successfully operating in several African markets, will allow customers to transfer money to any mobile phone in India, remit funds to bank accounts, deposit and withdraw cash from designated outlets, pay utility bills and shop at selected merchants.
"Mobile technology has a critical role to play in servicing the unbanked and underserviced sections of society," said Marten Pieters, managing director and chief executive officer of Vodafone India.
"Using M-Pesa, we will provide people in remote areas a convenient way to bank, transfer money and make payments in a safe and secure manner," he added, while noting that the serviced had been adapted to meet the needs of Indian customers.
The service will initially be targeted at migrant workers who need to send money home every month and is currently only available in the eastern states of West Bengal and Jharkhand.
"We have around 8,000 M-Pesa outlets which are urban, semi-urban and deep rural," said Suresh Sethi, business head of M-Pesa. "Just to add perspective, we are almost equal to the number of bank branches in that area".
Rajiv Sabharwal, executive director of ICICI Bank, commented: "This launch is in line with the bank's objective of achieving greater financial inclusion. It also enriches the bank's existing suite of mobile banking offerings."
The opportunities for both parties are significant in a country that is underbanked but has 900m mobile phone subscribers, as shown by the comments of the chief executive for international operations at Vodacom, the telecoms business which operates M-Pesa in several African markets.
"We have seen a phenomenal success in M-Pesa in Tanzania," he said. "Consumers will become our customers just because of mobile money."
Mobile banking is becoming increasingly popular in India, with the number of mobile banking transactions doubling to 5.6m in January 2013 compared to a year earlier.
Data sourced from Business Standard, dna, Seeking Alhpa; additional content by Warc staff