FINO, India’s largest business correspondent (BC) and alternative channel for financial services, today announced the acquisition of prepaid mobile payment business of erstwhile Nokia Mobile Payment Services in India.
With this acquisition, FINO having achieved significant scale in banking services, would be entering into the vast prepaid mobile payments space. In order to provide a smooth and quality service to its customers and maintain the dynamics of customer centric prepaid business, the new entity Alpha Payment Services India Private Limited (Alpha) (erstwhile Nokia Mobile Payment Services) would be operating as an independent company.
Explaining the importance of this acquisition, Manish Khera, CEO-FINO said,“Acquiring India’s prepaid mobile payment business from Nokia adds another feather to our cap. We believe that this initiative will take us beyond banking services to payments domain and enable direct engagement with customers. The assets we gain through this deal give us a distinct advantage in the market place.”
The new entity headed by Shweta Aprameya, will wholly focus on prepaid payment services and will offer services such as money transfers, utility bill payments, mobile & DTH recharges etc under the brand Takatak Money. This service would be bank and telecom operator agnostic and would aim to cater to the requirement of both urban and rural customers.
It is estimated that more than 65% of all retail transactions in India are conducted in cash(ASSOCHAM-Deloitte August 2011 Report).This presents a huge opportunity for digital payment systems, the mobile channel being the most promising. There is huge faith being put on leveraging the large mobile penetration to tap this potential, currently estimated at 920 million subscribers in India. The rural market contributes to a considerable 35% of the total mobile subscribers in India.
“Nokia is pleased that FINO will take over Nokia's obligations with regards to its mobile financial services in India and provide an opportunity for Nokia Money customers to continue to enjoy mobile money by transferring to Takatak Money accounts in the near future," said Gary Singh, General Manager & Business Head, Nokia Mobile Financial Services in India.
FINO currently services 50 mn customers across host of banking products and services and is very deep rooted in India covering over 50,000 villages. FINO has extensive experience of developing the right customer proposition and achieving scale in field and central operations, both critical for success in this market. This marriage of large deep penetration and modern technology backed offering is expected to create a winning formula for the benefit of large customer base.
“This is a strategic investment for FINO. It will add value to our comprehensive range of financial services products, thereby enhancing shareholders value. This new entity will further enhance FINO’s ability to meet the transaction needs of the un-serviced and under-serviced population of the country which offers a big business opportunity in the growing payment space in the country” said Rishi Gupta, CFO-FINO.
Over the last decade, Indian telecom story, especially the mobile growth rate helped create innovative business opportunities to corporates and entrepreneurs. The growing use of mobile applications and value added services is a point of proof in this context. Furthering this trend, mobile payments are expected to increase. Studies suggest money transfer and airtime top-ups will account for most of the volume of prepaid mobile payments. Money transfers will account for the largest portion of the transaction value because of the demand for secure and efficient ways of storing and transferring money.
Further, Tavess Research reports, mobile money in emerging markets like the Middle East, Asia, and Africa are expected to cross 1 billion users by 2015, with India accounting for over 100 million subscribers.