Bharati Airtel and Mobile Banking

By Aditya Mhatre at 2 October, 2007, 2:30 pm

Vodafone has painted the Mumbai town red to proclaim its arrival in the country. After a hard fought out battle with a few players, it finally won to buy a the 67 per cent stake from Hutch. Now, its fun time for the customers and the credit doesn’t go entirely to Vodafone. It’s Bharti Airtel which has had to think of ways to compete with Vodafone.

Bharti Airtel, India’s largest mobile phone provider is betting big on mobile phone transactions (both, pre and post paid) primarily for the following obvious economic reasons:

Lower transaction costs
Sheer size of the market (over 200 million now)
Millions of migrant workers in India
Add a few of more million of expartiates who repatriated $22bn in 2005

Bharti is working with IBM to create ‘Mobile Wallet’ where your mobile phone will double up as a credit card. The reserve Bank of India has already given the nod to Bharti and SBI to launch this project as ‘not for profit companies’ under Section 25 of The Company’s Act.�

How does it work technically?

I found a nice article in The Economic Times and I am replicating verbatim the entire process of buying and selling on the cell phone:

Point of Purchase: The cashier issues the message to the back-end with the number of the buyer and the amount he has to pay. The server verifies the vendor.
Confirmation: An SMS is then sent to the buyer’s phonbe. To validate the purchase, the buyer has to enter his unique 4-digit password and then send ‘Yes’.
Delivery report: The confirmation is then sent to the ticket counter and a ticket issued. The entire process takes a minute.

Bharti has already run such projects with telcos in Bangladesh and some European countries and is now targeting Africa. In India, the pre-paid customers can avail of this service already.

Oh well, after all, some of the credit goes toVodafone for all the hard work that Bharti is putting in!

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Categories : Business