NEW DELHI: Prime Minister Narendra Modi on Thursday launched an
e-trading platform for agricultural products, terming it a "turning
point" to ensure transparency in buying and selling of farmers' produce
across the country.
The Internet-based e-NAM (National Agriculture Market) is aimed at
integrating 'mandis' to help both farmers and buyers by providing them
data of produce available, its quality and the price being offered at
the bidding markets.
"This is a turning point for the agriculture community. The agriculture
sector has to be looked at holistically, and it is only then that
maximum benefit of the farmer can be ensured," said Modi, addressing a
gathering of farmers at Vigyan Bhawan here on the occasion.
He said that the e-trading platform will help farmers and buyers access a
huge market and help them to decide for themselves by providing
choices.
"It's (e-NAM) a very big possibility. This is for the time that the
farmers will be able to decide where, when and on what price they want
to sell their produce," Modi said amid cheers from the audience.
Initially 21 mandis from eight states have been linked to the NAM and as he pressed a button, all 21 logged in to the portal.
The government plans to link 200 mandis to the portal within five months and 585 by March 2018.
Modi also emphasised that farmers' income can be doubled only by applying scientific methods.
Giving example of a child, who would not be benefited if bathed in a
bucket of milk but would grow faster if fed in small quantities by a
spoon, he said that that flood irrigation was a "thing of past" and new
techniques of drip irrigation were to be adopted in the 21st century.
He also urged farmers to get their soil tested and then farm accordingly.
Speaking on the occasion, union Agriculture and Farmers Welfare Minister
Radha Mohan Singh said that the government was working hard for the
welfare of the farmers and launch of eNAM is a step in this direction.
Communications and Information Technology Minister Ravi Shankar Prasad said it was a "day of change" that will empower farmers.
Minister of State for Agriculture and Farmers Welfare Mohan Bhai
Kundaria and Sanjeev Kumar Balyan, Cabinet Secretary Pradeep Kumar Sinha
and Agriculture Secretary Shobhana Patnaik were also present on the
occasion.
Complex though that it might sound, the concept of dynamic pricing has been around for years in the offline market
Ever alighted from a swanky new car to buy
fruits from the vendor at a market and discovered that you are paying a
premium compared to someone who arrived on foot? If so, you were given a
glimpse of what is known as 'dynamic pricing,' a craft when the
street-vendor practices it and nearly an art form when it is determined
by complex computer algorithms.
Let us suppose friends are reacting to a group message that says "Let's
plan a trip to Ladakh in July." They all log in to their digital
devices to check airfares, only to realise that rates fluctuated by a
few thousands rupees each time a new search was made for flights. What
was happening to the excited friends was that an algorithm detected a
spike in incoming requests for a particular flight, causing air fares to
rise. In industry parlance, this is 'price optimisation' or the
determination of fare based on real-time demand.
Almost every
product or service you buy online is subject to dynamic pricing, and
understanding how it works is important to make smart spending
decisions. For companies, too, it is smart to price dynamically because
it helps them adjust to the vagaries of demand and supply.
"There is a misperception that dynamic pricing is an exploitative
pricing mechanism," says Kartik Hosanagar, a professor of technology and
digital business at The Wharton School, University of Pennsylvania,
explaining that the fact that supply and demand are not always perfectly
balanced justifies resort to dynamic pricing.
Demand and
supply, actually, are just two of the variables that go into determining
price, as we saw in the case of the eager friends who were headed to
Ladakh. In the case of travel industry, apart from demand and supply,
events such as festivals or holidays, time of day and occupancy are also
factors that can cause a change in fares, says Sanjay Mohan, the chief
technology officer of travel site Makemytrip, which is listed on the
Nasdaq.
While occupancy is a major factor determining fare in
travel, the number of buses or flights operating on the route are also
considered. For instance, if there is only one flight scheduled at 8 am
across airlines, it is priced higher. But if another airline schedules a
flight at, say, 8.30 am, capacity is doubled and competitive pricing
kicks in, says Ankur Bhatia, a director at travel software provider
Amadeus India.
Also in the travel industry, it's imperative to
have a vigilant dynamic pricing model in place since it deals with
"perishable inventory," meaning if a plane flies an empty seat there is
no way to recover the cost of the seat.
Complex though that it
might sound, the concept of dynamic pricing has been around for years in
the offline market. The auto driver you approach to take you to your
home at 6 pm asks for an "extra Rs 20," blaming it on traffic. The fruit
vendor round the corner who sells strawberries throughout the year
raises the price of the fruit by a few hundred rupees in off-season. You
also pay a premium for passport- size pictures that you get printed
urgently.
With services migrating to online platforms, pricing
them dynamically is now done using sophisticated algorithms that list
out an optimum price by considering more variables that an individual
can possibly include. For instance, online classifieds portal Quikr uses
one such algorithm to determine, say, the ideal price at which to list
that old car for sale. It helps sellers decide what it calls the
'maximum selling price' using an algorithm that takes into account
active listings as well as historical data and comparing these with
attributes of the product, such as the model's current price and year of
manufacture.
"Delivery time, weather, market conditions are
some factors that trigger an alert to change prices in ecommerce," says
Madhusudhan Rao, the head of India operations at Boomerang Commerce, a
startup that helps retailers integrate dynamic pricing solutions.
For cab-hailing apps such as Ola and Uber that work on an on-demand
model, ensuring that there is always a cab available on request requires
dynamic pricing to fulfil demand by providing supply. To do so, they
resort to 'surge pricing,' which has two effects: people who can wait
for a ride often decide to wait until the price falls; and drivers who
are nearby go to that neighbourhood to make an extra buck. As supply
increases, or demand falls, prices head back to the normal equilibrium.
"For the duration that surge price is active, the algorithm reads
demand data every five minutes and updates the multiplier effect that
determines fare," an Uber representative said.
A product that
is a runaway hit can also command prices, as in the case of the
hard-boiled candy, Pulse, that Noidabased DS Group launched last year.
It became so popular that local kiosks were asking consumers to pay a
50% premium to buy it.
While this might be a classic example of skewed demand and supply
spiking product price, there are also sly tricks by some online commerce
platforms which are not shy of discriminatory pricing. In what is
termed by industry experts as a shrewd way of targeting the well-off,
some of them quote prices depending on the devices from which the
requests emanate.
So, if you are checking from the latest iPhone, you could end up paying more than a buyer who uses an old desktop.
It's not all bad for the customer. Have you ever noticed price variations in the same products on an online shopping portal?
An algorithm makes it possible. It cross-references features of
products, matches common attributes, compares price and triggers an
alert if a similar product is charged at a different price on a
competitor's platform. A rule set in the algorithm decides whether the
price of the product needs to be changed to match the competitor's
price. This means that if a seller lowers the price of a popular product
online, its competitor is highly likely to do so, too.
So
while the friends planning their trip to Ladakh learned their lesson and
booked their tickets through one device in a single attempt, they also
put their learning to use by buying their winter wear at lower price in
summer.
Hitherto, a member of EPFO could withdraw 100% of the accumulated corpus if unemployed for a period of 2 months or more.
EPFO rules restricting withdrawal of employees' provident fund will
come into force after April 30. This means that in case you are
unemployed for 2 months or more and want to withdraw your full EPF you
can do so only within the next 15 days. After that the withdrawal amount
will be restricted and you will be able to get the full amount only
when you turn 58.
On Feb 10, 2016, the ministry of labour and
employment made sweeping changes in the EPF rules restricting the
withdrawal of EPF corpus.
Hitherto, a member of EPFO could
withdraw 100% of the accumulated corpus if unemployed for a period of 2
months or more. The accumulated corpus is a sum of employer's
contribution, employee's contribution and the interest earned on them.
Of course, the person needs to have accumulated some EPF in a previous
employment to have a corpus to withdraw at all.
However, the
new EPF rules have restricted the amount of withdrawal that a member can
make. Under the new rule, a member after being unemployed for 2 months
or more can withdraw only his own contribution and the interest earned
on it. He can't withdraw the corpus generated from the employer's
contribution along with the interest earned on it. A member in the
Employees Provident Fund Organisation (EPFO) can withdraw the full
Employee Provident Fund (EPF) corpus only after attaining the age of 58
years. So, if you are jobless for 2 months or more and wish to withdraw
the full EPF corpus, you just have 15 days to get it out.
The
government has deferred the implementation of the new rule till April
30, 2016. From May 1, till 58 years of age you can withdraw only your
own contribution in EPF which equals 12% of your basic salary plus the
interest if unemployed for 2 months or more. The employer's contribution
plus the interest accumulated will be withdrawable only once you attain
the age of 58 years.
We consider a hypothetical scenario
wherein a person after being employed for 20 years becomes jobless in
the month of Jan, 2016. Assuming his basic salary as Rs 25000 per month
for the whole period his own contribution in EPF would be Rs 3000 per
month. If he contributes for 20 years, his own contribution of Rs 7.20
lakh (12%*25000*12*20) will yield him a corpus of approximately Rs 19
lakh which includes the interest on his contribution. What's more, the
employer's contribution of Rs 4.20 lakh will grow to Rs 11.50 lakh
approximately which includes the interest component too. In this case,
we have assumed an interest rate of 9% per annum compounded yearly for
the whole period. As he became jobless in Jan, he is unemployed for a
period of more than 2 months as on date.
Under the current
rule, if he withdraws his EPF corpus before May 1, then he can withdraw
the full corpus of Rs 30.5 lakh. However, if he doesn't withdraw before
May 1, he can take out his own contribution and interest of Rs 19 lakh
even after this date provided he remains jobless. However, the remaining
Rs 11.50 lakh can be withdrawn only after he reaches the age of 58
years. You can however, withdraw 90% of the employer's contribution plus
interest at the age of 57 years. Importantly, the erstwhile rule of
zero interest on inoperative accounts was quashed from April 1. Hence
the employer's contribution lying idle in the EPF account till the age
of 58 years will continue to earn interest.
Therefore, if you
are jobless for 2 months or more and have liquidity concerns, try to
settle the EPF account before May 1. If you withdraw you can get the
full accumulated EPF corpus (includes your own contribution, employer's
contribution and the interest earned) which will assist you in tiding
over problems faced due to unemployment in a better way.
RBI launches UPI; money transfer now as simple as
a text message
With the Unified Payment Interface, the customer
will need only one app, instead of multiple ones. And she won’t
have to reveal her bank details either. So, is it as hassle-free
as it is hyped up to be? Read on.
The Reserve Bank of India launched the Unified
Payment Interface today. Through this interface, it aims to
make money transfers easier and hassle-free. As the name says it
all, it will be a unified, go-to-place for transactions.
What is Unified Payment Interface (UPI)?
It is a payment system that will allow you to use a mobile
phone to make money transfers. A virtual debit card, if you
will. How can you make payments?
For starters, the customer needs to have a bank account to
make payments. That done, she will need to download an
app on her smartphone. She can start making
payments. It is as simple as sending a text message. How is it different from the apps that banks provide?
Every bank requires you to download its app. So, if you have
two bank accounts, you will find yourself needing two apps on
your smartphone. But, with this interface, the customer needs
to dowloand only one app. The UPI interface will network all
the banks together and make it possible for the customer to
make her transactions using a single app. Is it safe?
Very much so. The customer will be given a virtual ID and
won’t have to disclose her bank details. Of course, she will
have to authenticate her ID with a password. Are there different kinds of IDs?
If it is an overseas transaction, you will be allowed to use
your mobile or Aadhaar numbers as your ID. For local purposes,
a virtual address will do. How does it work?
If you buy a product from Flipkart using your smartphone, you
will have to give your virtual address, and the company or
merchant will request money from it. Once you key in your
username and password – without having to go into your bank
details – the transaction will have been made.
Unified payment interface a step towards a cashless economy
National Payments Corp of India’s endeavour
is expected to make e-commerce transactions easier, will
facilitate micropayments and person-to-person payments
RBI governor
Raghuram Rajan says improved payment infra, along with the
launch of differentiated banking models such as payment
banks are part of a revolution in Indian banking. Photo:
Bloomberg
Mumbai: India moved a step closer towards becoming
a cashless economy with the launch of National Payments
Corporation of India’s (NPCI’s) unified payment interface
(UPI) on Monday.
UPI, which is expected to make e-commerce transactions
easier, will also facilitate micropayments and
person-to-person payments.
The system will allow customers to instantaneously
transfer funds across different banks with the use of a
single identifier which will act as a virtual address and
eliminate the need to exchange sensitive information such
as bank account numbers during a financial transaction.
As a start, 19 banks have partnered with NPCI, an
umbrella organization for all retail payments systems, to
offer services based on UPI.
UPI is one of many innovations taking place in the
financial sector that will benefit the customer, said
Reserve Bank of India governor Raghuram Rajan.
The introduction of UPI, in particular, is expected to
have a significant impact on the ease of retail payments
at a time when mobile banking is picking up.
In the September-December quarter, the value of mobile
banking transactions surged 82% over the same period the
previous year.
“There is collaboration in this revolution but there is
also immense competition and the winner is the customer.
We hope customer experience with developments like today’s
improves tremendously and the ease of making payments, the
ease of saving and the ease for buying financial products
also improves tremendously,” said Rajan.
Rajan added that the improved payment infrastructure
along with the launch of differentiated banking models
such as payment banks are part of a “revolution” in Indian
banking.
“What we have in India is the most sophisticated public
payments infrastructure in the world. (But) It is not just
the payments that are part of the revolution; it is a
whole new set of banks that are coming in,” Rajan said at
the launch of UPI.
The central bank granted in-principle approval to 11
payments banks and 10 small finance banks last year.
Payment banks will provide basic savings, deposit,
payment and remittance services to people without access
to the formal banking system. They will not be in the
business of lending.
The small finance banks will offer basic banking
services, accepting deposits and lending to unserved and
underserved sections including small business units, small
and marginal farmers, micro and small industries and
entities in the unorganized sector.
The new banks and the initiatives of older private and
state-owned banks have led to the revolution, Rajan said.
NPCI has been working on UPI since February 2015 under
the guidance of Nandan Nilekani, co-founder of Infosys Ltd
and former chairman of the Unique Identification Authority
of India.
The new interface is built on the same infrastructure as
the Immediate Payment Service (IMPS), which is currently
used by banks for real-time transfer of cash. Though the
transaction limit for IMPS is Rs.2
lakh per transaction, for UPI the limit has been set at Rs.1 lakh .
“Payments have evolved in different ways. You had a card
system, mobile money, Internet e-wallets. But completely
mobile interoperable person-to-person instant real time
with push and pull really didn’t exist anywhere. So I
think that is where this is a leapfrog,” Nilekani said at
the launch.
Nilekani added that UPI takes the IMPS platform—on which
about Rs.2.4 trillion of
transactions are conducted annually—a step further. “IMPS
did not have an easy debit capability. That is being
addressed by this platform,” said Nilekani, adding that
just as IMPS had scaled up quickly over the last five
years and has nearly 50% share of the remittance market,
UPI will soon become an important payment platform for all
merchants.
With the platform going live, the onus now shifts to
banks to market and communicate the benefits of using UPI
to their customers. Over time, bankers see applications
based on UPI becoming the norm.
“It is going to make small value payments more
electronic. I think what UPI can do is bring next
innovation such as e-payments on delivery,” said Chanda
Kochhar, managing director and chief executive officer
(CEO) of ICICI Bank Ltd. “I see this becoming really a
preferred option for payment for both customers and the
merchants.”
The real benefit of UPI will be in digitizing last-mile
payments, said Sachin Bansal, co-founder, Flipkart.
“In a lot of ways, cash on delivery and wallets exists in
the interim until we find the final version (of payments).
We are hoping that UPI will solve the last-mile final gap
and make our experience for users a magical one,” Bansal
said.
Earlier this month, Flipkart acquired PhonePe Internet
Pvt. Ltd, which is working on a UPI-based payments
solution.
“PhonePe’s mission is to significantly improve the online
and offline digital payments experience for millions of
Indian customers. We are really excited to merge with
Flipkart and get access to one of the largest consumer
bases in the country, which will allow us to realize our
vision at a much larger scale,” PhonePe CEO Sameer Nigam
said on 1 April, when Flipkart announced it will buy the
company.
“Payments has been one of the biggest hurdles for mass
adoption of online shopping in India. UPI has the
potential of transforming the entire payments ecosystem in
the country,” Flipkart CEO Binny Bansal said on 1 April.
Shikha Sharma, managing director and CEO, Axis Bank Ltd,
considers UPI the WhatsApp moment for payments in India.
“Just as Aadhaar has become the base for a lot of policy
reform, I think UPI has the potential to dramatically
change the payments landscape. The fact that you have a
low-cost acquiring solution which is safe can dramatically
propagate merchant acquiring across the country,” Sharma
said.
The impact of UPI on electronic wallets is to be seen.
Some people say it could mean the end for wallets—a
transitory step between traditional payments mechanisms
and a full-fledged digital one such as UPI—while others
say it will simply make it easier to own and operate
wallets.
Rajan sounded a note of caution as well and asked banking
entities to improve grievance redressal systems and use
technologies such as UPI to expand access to formal
financial channels.
“Somewhere along this chain, a transaction may go wrong.
We hope that happens rarely, but it could go wrong,” he
warned, adding that NPCI should now work towards
protecting the system from security breaches and
fraudulent transactions.
Apart from this, the focus should also be towards
bringing in those outside the payments universe and those
without smartphones, added Rajan.
RBI to launch Unified Payment Interface on April 11
The Reserve Bank of India (RBI) April 11 will
launch Unified Payment Interface (UPI), which will make money transfer
as simple as sending a text message. In the first phase, which will
start next week, 29 banks will operate the platform. It will be
inter-operable across different banks and will allow instant payments.
RBI to launch Unified Payment Interface on April 11
The Reserve Bank of India (RBI) April 11
will launch Unified Payment Interface (UPI), which will make money
transfer as simple as sending a text message. In the first phase, which
will start next week, 29 banks will operate the platform. It will be
inter-operable across different banks and will allow instant payments.
The Reserve Bank of India (RBI) April 11 will
launch Unified Payment Interface (UPI), which will make money transfer
as simple as sending a text message. In the first phase, which will
start next week, 29 banks will operate the platform. It will be
inter-operable across different banks and will allow instant payments.
This UPI method could change the micro-payment landscape in the country.
According
to a report, 95 percent of consumer transactions in volume terms and 65
percent in value terms are in cash. This is much higher than the 40-50
percent transaction in volumes and 10-20% in value terms for advanced
economies.
Therefore, the government and the Reserve Bank of
India have been working on ways to reduce cash in the economy.
Considering the number of smart phones in the country is estimated to go
up from 150-200 million to 500 million, mobile money transfer is
expected to get a boost.
Moreover, payments can be made by only knowing the mobile or Aadhaar number.
The platform will help eliminate the requirement of receiver's bank account, IFSC code
Mobile wallets beware, UPI is here
The demise of mobile wallets in India would be quite a shocker. What
will happen to all the seamless payments to your taxi vendors and
favourite sumptuous food deliveries?
The National Payment Corporation of India (NPCI), a primary body
governing all retail payment systems in the country, may have some good
news for you. Through launching their Unified Payments Interface (UPI), a
customer is no longer required to give their personal credentials like
account details, security pins. On Saturday, NPCI also launched a hackathon for the developer community opening APIs to build on the UPI platform.
Demystifying the UPI
UPI with its mobile first payments design moves towards interoperable
and instant payments. The interface allows customers to make payments
through a single identifier like Aadhaar number or virtual address.
The core features will help understand the payment cycle.
1) It enables you to make payments using
your mobile phone as the primary device for payments including
person-to-person, person-to-businesses, and businesses-to-person with
the ability to pay someone as well as ‘collect’ cash from someone.
2) The platform also allows you to use
Aadhaar number, mobile number, and account number in a unified way,
while not giving it away during the payment process. You could just
create a ‘virtual payment addresses’ that are aliases to your bank
accounts.
The virtual payment addresses doesn’t
allow your security to be compromised when a certain merchant’s account
is hacked, because their database will have only a list of virtual
addresses. The payment addresses are denoted by ‘account@provider’ or
userid@mypsp (i.e. tarush@icici).
Moreover, the platform also allows you to
transfer funds using only Aadhaar number as your identifier, which
really equips the rural demographic. Today, according to Nandan
Nilekani, former Chairman UIDAI, there are 250 million Aadhaar payment
bank accounts, making 1.2 billion transactions a year with around 77,000
micro ATMs in the country.
3) Another exciting feature is the ‘pay
by’ date, which is made while making a collect request to others
(person-to-person or entity-to-person), which allows payment requests to
be ‘snoozed’ and paid later before expiry date without having to block
the services.
4) It also allows multiple recurring
payments similar to electronic cash payments (utilities, school fees,
subscriptions, etc.) with a one-time secure authentication and rule
based access. This could be useful for organisations while paying
salaries.
5) UPI also equips Payment System Players
(PSP), the banks in this case, through their mobile applications to
allow paying from any account using any number of virtual addresses
using credentials such as passwords, PINs, or biometrics (on mobile
phone).
This means that one can create separate
virtual addresses for separate tasks like bill payments, charity
donations and be used as wallets with certain rules. For example, if a
user donates to Akshay Patra every month, one can create a virtual
address just with that.
6) UPI also makes the system fully
interoperable across all payment system players without having silos and
closed systems, making you transact from any bank.
Thus, with payment banks,
newer PPIs, the platform has standardised the m-pin system for all
banks, while combing the phone with it. However, all these entities need
to be UPI compliant. Thus, you can now make payments if you’ve access
to (single-identifiers) either – mobile numbers, Aadhaar authentication, and m-pin.
7) Lastly, the ability to make payments
using 1-click 2-factor authentication all using just a personal phone
without having any acquiring (swiping) devices or having any physical
tokens.
Thus, if UPI is implemented it will work better on frictionless
payments, without people having to transfer funds to wallets and being
bound by rules. With better interoperability, UPI gives users the
freedom to use their money, they want to without worrying them of
security. Moreover, the ‘common library’ or landing page for
payments as refered to NPCI is all in-app. However, the features are
also available on a website where a person can make a collection
request.
Therefore, we foresee the extinction of an Indian mobile wallet.
Moreover,Nandan Nilekani, Chairman, Unique Identification Authority of India (UIDAI) and an Advisor to NPCI, believes that in
order to create a massification system, one needs to reduce the
on-boarding cost. Thus, in this case, UPI is a winner as only your
mobile number needs to be registered with your UPI compliant bank.
Further, he hopes that if RBI allows eKYC then users can open bank
accounts too on the fly.
Your Story take – Permutations and Combinations
It helps e-commerce players to seamlessly collect funds on Cash on
Delivery, without risking customer’s account information. It also helps
merchants tap customers without any cards. However, for customers it
offers multiple utilities on cash on delivery, bill splitting, merchant
payments, and remittances.
Moreover, UPI through offering a ‘collect’ feature, improves the
entry barrier for startups and businesses, allowing even an individual
to function as a businesses (by themselves) solving their problems of
collecting money for services and products.
However, it could turn a little sour for wallet startups like Freecharge, Paytm, PayU, and Oxigen Wallet.
This is because the regulations don’t allow wallet-to-wallet
interoperability. For example, one cannot make transactions from a Mobikwik
to a Paytm. This is applicable for semi-closed wallets like Vodafone’s
m-pesa and Airtel Money. In order to operate on the platform, these
startups might have to partner with the 15 odd banks that are partners
with the platform. It doesn’t make things any easier for companies with
payment bank licenses like Paytm since they don’t have their wallet registered under their payment bank.
While for Snapdeal it makes operations easier for e-commerce, for
Freecharge (Snapdeal’s acquisition) it can make them vulnerable for an
attack by new entrants working on the UPI platform. Freecharge Go did
try to break the loop of interoperability by allowing customers to pay
to all online merchants through a virtual prepaid card, however, the
limitations of e-wallets exist.
Sharad Sharma, Co-founder, iSpirt, said during the launch “We need
startups to realise that the existing infrastructure has not been given
away. They can come onto the UPI platform through partnering with PSP
banks. For wallets, this could be a beginning to build on a better
platform dealing with the problem of cashless payments better.”
However, Karthik Vaidyanathan, Co-founder, Momoe,
a mobile payments company, refutes saying that now for payment startups
it becomes a sales process, where they have to pitch to partner banks.
Moreover, with rights of APIs, even banks will take some time to figure
out how they can leverage this technology.
But these partner banks to the UPI platform have their own wallets
like SBI’s State Bank Buddy which now have suddenly got a boost of
technology, giving them level field to compete with the private wallets.
Moreover, A. P. Hota gives hope that it is only a matter of months
that wallets will also be included in the gamut of things by RBI. But we
would say that why need a wallet in the first place.
Everything said, now with NPCI opening the API to developers for
their hackathon it will be interesting to see how startups leverage the
power of the platform.
The National Payments Corporation of India has launched the Unified
Payment Interface (UPI), which experts say has the potential to
revolutionise mobile payment system in the country. NPCI is the
umbrella organisation for all retail payment system in India.
The biggest benefit of Unified Payment Interface is that it will be a
single app for accessing different bank accounts. And anyone using the
interface for sending or receiving money from their mobile phones need
not give their bank details to the other party.
Through UPI, a customer with a bank account is identified with an
email-like virtual address. The new platform also allows a customer to
have multiple virtual addresses for multiple accounts in various banks.
For example, a customer can also decide to use his or her short name for
the virtual address such as XYZ@sbi or XYZ@icici. Since bank account
details are not given in this virtual address, the customer can freely
share the UPI financial address with others.
For example, if you want to receive or may payment through a particular
bank account, you just have to give your virtual financial address
(XYZ@sbi) to the other party. For making payment, once you authenticate
the transaction through a secure PIN, the transaction it will be
complete. You don't have to share your bank details.
The other benefits of this mobile payment mechanism include its round the clock availability and faster checkout.
The Unified Payment Interface is an advanced version of NPCI's Immediate
Payment Service (IMPS) which is a 24X7 funds transfer service.
NPCI said 29 banks have agreed to join the platform. Launching the new
platform, RBI Governor Raghuram Rajan on Monday said that it will
empower users to perform instant push and pull transactions seamlessly.
Currently,
most e-tailers and restaurants outsource deliveries to two-wheeler
riders as it both speeds up the process and is cost-effective.
CHENNAI/NEW DELHI: E-commerce companies and quick-service restaurants may soon have to put the brakes on last-mile deliveries through private two-wheelers with the government working on rules to regulate their use for commercial purposes.
Currently, most e-tailers and restaurants outsource deliveries to two-wheeler riders as it both speeds up the process and is cost-effective. In many cases, the delivery person owns the bike and gets paid a commission upon completion of the job. This is all set to change with the government planning a new categorisation called 'two wheeler goods vehicles'. These will be fitted with a box for carrying goods, according to a draft notification issued by the Union road transport ministry.
"Any motor vehicle used for commercial purposes should be treated as such regardless of the number of wheels. We are witnessing rampant misuse of the law by several firms that use private two-wheelers for commercial purposes. We are writing to the government as we need rules," said SP Singh, senior fellow and co-coordinator of Indian Foundation for Transport Research and Training, an independent body.
While there are a few rules for private vehicles, if classified as commercial, a different set of rules would kick in. Some of these include differentiated insurance tariffs, road taxes, mandatory periodical fitness certificates, driver badges, police verification. All this will push up cost of deliveries. TOI tried to contact firms like Flipkart, Amazon, Snapdeal, and Swiggy but emails and calls went unanswered.
The Union road transport ministry issued the draft rules on two-wheeler goods vehicles last November but the final notification is yet to come. "We are processing the suggestions and objections that we have received to the draft notification. The final notification will be out soon," said a transport ministry official.
The proposed norm specifies that the two-wheeler go- ods vehicles will have to be 550mm long and 510mm wide, while each box could carry a maximum weight of 30kg. This will prevent overloading, a common problem.
Insurers too are waiting for regulations. "We insure two-wheelers knowing fully well that they are used for pizza delivery. The Insurance Regulatory and Development Authority does not have any separate classification for commercial two wheelers," an insurer said.
Once the rules get notified, it will be left to the states to implement them. For instance, states like Karnataka oppose two-wheeler taxis while Haryana and Goa have allowed them.
If the deal valued at $10-20 million goes through, it will be Flipkart’s third major acquisition in payments
Flipkart has been a laggard in payments. The e-commerce firm shut PayZippy in August 2014 after the product failed to sell to as many customers as the firm had expected. Photo: Hemant Mishra/Mint
Bengaluru: India’s largest e-commerce company Flipkart Ltd is in talks to buy a majority stake in PhonePe Internet Pvt. Ltd, a payments start-up started by three of its former senior executives, two people familiar with the matter said.
Mint couldn’t confirm the exact size of the proposed deal, but one of the two people cited above said the companies are negotiating an amount between $10 million and $20 million.
The deal is in advanced stages and is likely to be completed within the next 45 days, the two people said.
Flipkart didn’t respond to an email seeking comment. PhonePe didn’t respond to calls and messages on Thursday.
PhonePe was launched in December by Sameer Nigam and Rahul Chari, former senior leaders who recently left Flipkart, and Burzin Engineer, another former Flipkart executive.
“Our goal is to make digital payments so easy, safe and universally accepted that people never feel the need to carry cash or cards again. We believe India is at the cusp of a new mobile revolution, which will change the way we manage our money on the go. We see ourselves facilitating this change, by giving people and businesses the power to make commerce more simple, open and seamless,” according to a note on the company’s website.
Flipkart has been a laggard in payments. The Bengaluru-based company shut PayZippy in August 2014 after the product failed to sell to as many customers as the firm had expected.
If a deal goes through, PhonePe will be Flipkart’s third major acquisition in payments.
Flipkart bought payments start-up NGPay (Jigrahak Mobility Solutions Pvt. Ltd) in 2014, although no new payment technology or service has come out of that company so far. Last August, Flipkart also purchased FX Mart Pvt. Ltd, which owns a prepaid wallet licence. The company subsequently launched a mobile wallet called Flipkart Money earlier this month.
Payments is a key function in e-commerce. Yet, because of a combination of lack of focus by e-commerce companies, limited utility for shoppers, unreliable Internet connectivity and regulatory hurdles, payment solutions are currently used only to buy a very narrow range of products and services such as mobile recharges and cab rides. A majority of payments in India still happen via cash.
The current market leaders in payments are Paytm (run by One97 Communications Ltd) and Snapdeal-owned Freecharge followed by a host of smaller firms such as Oxigen Services India Pvt. Ltd and One MobiKwik Systems Pvt Ltd.
PhonePe hasn’t released a product yet but it is working on a payments solution based on the Unified Payments Interface (UPI), which is an initiative of the National Payments Corporation of India.
Some experts expect UPI to transform the payments business as it will allow the transfer of funds between banks with the help of a single identifier and facilitate instant payments through banks.
Nigam, Chari and Engineer previously founded digital content start-up Mallers Inc., which was bought by Flipkart in late 2011. Flipkart adopted Mallers’ technology to launch a digital music service called Flyte, but shut down the service in 2013 after Flyte struggled to generate enough demand.
Nigam and Chari, however, rose among the ranks quickly at Flipkart, performing roles across functions such as engineering, supply chain and marketing. Nigam was senior vice president, engineering, when he left Flipkart last August, while Chari was vice-president, supply chain, when he left in November.
