Real-time money transfer via IMPS grows really big

Tags: Banking

The simplicity of the facility is luring more and more customers

All of us at one point of time would have faced a situation wherein we were unable to receive or send money as the day was a Sunday or due to bank holiday. With banking becoming 24x7 and almost cashless, such problems have a handy solution now. Money transfer has now become instantaneous, thanks to low-cost immediate payment service, better known as IMPS. This money transfer facility has caught the fancy of customers in urban and rural areas, and even corporate customers are using this service to send reimbursements, commissions and even salaries.

RBI data shows monthly volumes topped Rs 10,000 crore in April 2015, nearly five times of Rs 2,156 crore in the year-ago period. In whole of 2014-15, nearly Rs 59,000 crore was sent just via IMPS. The simplicity of the model is a major draw. Customers can transfer and receive funds via IMPS using their registered mobile number and mobile money identifier (MMID) or account number and IFSC code. Even NRI customers can transfer funds from their NRI account to a resident account using IMPS. Over 80 banks are members of IMPS system.

National Payments Corporation of India conducted a pilot study on the mobile payment system with the banks like SBI, BOI, UBI and ICICI in August 2010. IMPS was launched in November 2010.

AP Hota, MD&CEO, NPCI, said, “The future of payments is real time. Sooner the banks realise the same and roll out products, the better would be their competitive advantage.”

Axis Bank, which has the second largest number of MMIDs issued at over 1.2 crore, operates IMPS through various channels like mobile banking, internet banking and also extends it to corporate customers, says Rajiv Anand, group executive, retail banking.

"Over past three months, we have been among the top remitters. In May, there were 20 lakh IMPS transactions from our side and the average ticket size was Rs 7,000. It’s an outstanding platform. We are also using our multi social payment solution PingPay on the IMPS architecture," Anand said.

The size of funds that can be sent via IMPS can range from a minimum Re 1 to a maximum of Rs 2 lakh. Banks charge as low as Rs 2.5 to Rs 15 (excluding tax) for sending funds, depending on the quantum.

Arjun Chowdhry, head of credit cards and unsecured lending, Consumer Bank, Citi India, said: "Citi leverages IMPS as a simple and secure electronic platform to remit funds round the clock, instantly, to all participating bank accounts, anywhere in India. Citi provides this ubiquitous service, across digital channels - online, mobile, SMS and ATMs. In fact, Citi is among the first banks to enable transfers through SMS, and more recently via our ATMs."

"There has been a gradual shift towards IMPS, especially for small value transfers. Transactions are instant, safe, as managed by NPCI, and available 24x7, leading to growing customer acceptance. At Citi, IMPS contributes to over 40 per cent of transfers, which has been growing steadily at 50 per cent yearly. Citi has market leadership in IMPS transactions, with a share that is as high as 8 per cent by value, and is the 5th largest remitter amongst banks in India," he added.

Not just in metros, IMPS is a hit in rural areas as well. Asit Oberoi, group president and COO, Yes Bank, said: "...IMPS has been deployed as a potent mechanism for financial inclusion as well wherein migrant workers in Indian cities remit money to their kith and kin in rural India using the mobile number. Volumes processed under IMPS exceed 7 lakh transactions per month."

He also said there are multiple instances where reimbursements, commissions and salaries are remitted to customers using the IMPS route. This provides corporate customers the flexibility to initiate transactions post 1900 hours in the evening on working days (which is the last time for traditional remittance mechanisms like RTGS and NEFT). "On an average over Rs 30 crore are routed through this mode by corporate customers in a month and the numbers are bound to increase with the gaining popularity of IMPS among customers,” Oberoi said.

kumarshankar@mydigitalfc.com

That is a great news to know

That is a great news to know that money transfers can become almost instantaneous. This is one of the subject of the Global Forum about Remittances in Milan next week.

There are services there as exhibitors like IMTC (organization) or Moneytis (cheapest money transfer finder), there would be a real need to be partners with them !

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