See discussions, stats, and author profiles for this publication at: https://www.researchgate.

net/publication/302586756

E- WALLET – A ‘PAY’VOLUTION

Conference Paper · October 2015

CITATIONS READS
0 829

1 author:

Venkata ramana rao

Siva Sivani Institute of Management
5 PUBLICATIONS   8 CITATIONS   

SEE PROFILE

Some of the authors of this publication are also working on these related projects:

Research papers published View project

Presented Paper View project

All content following this page was uploaded by Venkata ramana rao on 01 February 2020.

The user has requested enhancement of the downloaded file.

 E- WALLET – A ‘PAY’VOLUTION
Dr.S.V.Ramana Rao
Professor and Area Chairperson – Finance
Siva Sivani Institute of Management, Secunderabad
ramanarao@ssim.ac.in
09959110061

Abstract

Smartphone has gained lot of prominence in our day to day life and its offering many services
and people can do many things by just tapping the phone. This electronic gadget not only serves
as a communication tool but also used for socialization, entertainment, internet access and
payments. Technology has enabled the smartphone users to do merchandising. Besides payment,
people can also do functions like store receipts, coupons, business cards, bills…in their
smartphones. When smartphones can function as leather wallets, it is called “Digital Wallet” or
widely known as “Mobile Wallet”. Multiple players are involved under the present electronic
payment system. For example, Visa and Master card links four parties like issuer, customer,
Merchants and Merchant acquirers. Mobile phones are facilitating commerce to grow by making
payment ecosystem simple and easy. This paper attempts to explain about E- wallet industry and
its growth and challenges. 30% is the annual projected growth in the Indian mobile wallet market
from 2015 till 2019 as the studies conducted by various agencies. Many banks and telecom
service providers are collaboratively offering mobile payment and its allied services. An attempt
has been made to understand ICICI E- Wallet Pocket. It had over a million downloads in the first
three months of financial year 2016, with more than half of those transacting on it being new –to-
bank customers. A study on Pockets customer base is revealing that as many as 50% are under
25 years of age; 80% are less than 35. Around 70% of those downloading Pockets are new –to –
the – bank customers due to the unified offering on the mobile phone combines banking
transactions, non-banking transactions, ecommerce payments and social integration. There are
few attributes which made mobile money or wallet popular because it can avoid snatching,
misplacing or pickpocketing and decimal payments can also be made easy. Another incentive to
use E- wallet is non-disclosure of sensitive information. In spite of advantages there are
bottlenecks for the growth of E-Wallets such as dependability and speed of internet connection
and amount that can be deposited in mobile wallets. High value payment transactions have
limitations in usage of mobile wallets. Historically the payment industry operated separately with
the system of bank and bank related issuers, acquirers, processors and networks. These players in
the system should play a vital role in developing standards, guidelines for participation in the
industry. Now, however, the old arrangements are rapidly fading and a new industry order is
taking their place.

1
Introduction

Rapid penetration of smartphones in everyday life transformed many aspects like the way people
of connecting with each other, information sharing and financial transactions. Smartphones has
brought many user friendly functions including payments to various transactions. Technological
advancements made people life easy and many of the activities can be done at a tap with
smartphone. Mobile users can use their smartphones to make payments by using applications
installed in the phone. Along with the payments, smartphones are facilitating storing of receipts,
coupons, business cards and bills etc. Smartphone apps can perform the functions of hard money
hence it is called “Digital Wallet” or “Mobile Wallet” or “Mobile money “ also referred as
mobile payment, mobile money transfer. World bank (2010) has explained it as a intersection of
both banking and telecommunications services. Mobile wallet has many significant features like
anytime transfer, mobile transfer, secure and convenient transfer of money. It can also be
considered as a bank for those who do not have approach to banks and do the banking activity
like sending and receiving money. Digital wallets are gaining momentum in the Indian market
due to increasing technology penetration and acceptance of new developments by the customers.

By using E- Wallet payments can be made any time anywhere including receiving money,
storing, sending. It works very closely with banks and telecom companies to offer banking
services to its subscribers. Through Money transfer option one can send money from their
mobile money account to a different subscriber anywhere anytime, which is similar to airtime
transfer, where one can purchase and send airtime to another subscriber within the same network.
Prepaid mobile phone services signposted the way for use of mobile for financial transaction
which is going to help in big way to do lot of transactions especially who are having little or no
access to banks. A customer can pay for services by having preload money without
authentication process. At present there are many mobile wallet companies in the country
competing to provide hassle free services to customers.

Rationale for research work and Methodology

Indian’s payment industry revenues are nearly $14 billion out of total payments approaching $9
trillion. Payment flows are 7.8 times GDP, comparable to many Western countries and emerging
economies, such as Brazil (7.3), Italy (7.2) and the U.S. (7.0). Although sources vary widely by
bank, payments contribute about 30 percent of bank revenues1. As per the Time of India article
published on Aug 23, 2015, 29% of all online transactions globally are done on mobile. 80% of
the world's adult population will have smartphones by 2020. Around Rs 1,200 crore plus will be
the value of the Indian mobile wallet market by 2019. The figure stood at Rs 350 crore till last
year. 30% is the annual projected growth in the Indian mobile wallet market from 2015 till 2019.
These statistics are instigating to understand about Mobile money market in the Indian context.
Hence this paper is aimed at to understand conceptually about mobile money, its growth and
1
Raj Kamal, Renny Thomas and Ranjit Tinaikar, A strategic review of India’s emerging payments market, Sep 2009
www.mckinsey.com

2
development as an industry and challenges to grow. As this work is descriptive in nature the
paper provides a broad overview of mobile payment industry especially in the Indian context. An
attempt has also been made to explain ICICI E- Wallet Pockets which was launched recently.
This work has been carried out by using secondary data which was collected from financial
dailies, news dailies and research reports by various consulting firms etc.
Digital wallet
The term digital wallet has been applied to diverse forms of electronic payments, even some as
simple as prepaid cards. In addition to money, however, traditional wallets also typically hold
various forms of payment and identification that might be stored and accessed digitally. Digital
wallet has been defined as a software application that enables users to digitally store money,
payments credentials and more, and to use these to implement various types of cashless
transactions.2
Types of wallets3

There are four types of mobile wallets are in operation in India. They are Open, Close, Semi –
open and semi –close.

Open Wallets: These are the wallets which allow buying goods and services, withdrawing cash at
ATMs or banks and transferring funds. These services can be offered in collaboration with Bank
and cellphone service providers. For instance, Vodafone mobile operator partnered with ICICI
bank to launch M-Pesa which has provided a platform for service providers and application
developers to integrate with Vodafone’s payment mechanism, by giving access to its billing
API.4M-Pese by Vodafone is offering open wallet services.

Semi Open Wallet: In this type of wallet the telecom service provider allows to transact with
whom the service providers have tie up. Customers cannot withdraw cash but can spend only
what customers have loaded. For example, Airtel Money is semi open wallet allows its
customers to transact with merchants who have an understanding with Airtel.

Closed Accounts/Wallet: This category is popular with E-commerce companies. When customer
money is locked may be due to order cancellation, return of goods and gift cards, these
companies permit customers to use blocked money for merchandising.

Semi –closed Wallet: It will not allow customers to withdraw cash or redemption but permit the
customers to buy goods and services at listed merchants and do financial transactions. For
instance, PayTM do not permit cash withdrawal or redemption but permits to buy goods and
services.
2
Sameer Gulati, Marie-Claude Nadeau, Kausik Rajgopal , Gauging the disruptive potential of digital wallets,
McKinsey on Payments,Volume8,Number21May2015,pp:4,
www.mckinsey.com/~/media/McKinsey/.../MoP21_digital_wallets.ashx
3
A guide to mobile wallets, The Times of India, Aug 23, 2015
4
Electronic Payments 2.0: The Second Coming of Mobile Payments Startups, www.nextbigwhat.com/electronic-
payments-in-india-mobile-payments-2.

3
Preloaded Money- Its Operations:

As per Reserve Bank of India guidelines5, the mobile wallet service provider needs to create an
escrow account and the customer’s credited money needs to be maintained in the same account
till it is being used. Hence the customers need not worry on the money being maintained in the
mobile wallets. However, customers need to check whether mobile wallet service providers are
adhering to RBI guidelines or not. Vijay Shekhar Sharma6, founder CEO, PayTM, said that
"When you register with us, we create an escrow account in which your preloaded amount is
deposited. Only when you make a payment, the respective amount is credited to PayTM account.
We don't have any control over your money, so there is no question of the service provider
running away with the customer's money."

Brief History of Payment System7

Money is the life line for human life and for economy. The underlying desire for continuous
improvement makes human race invent, innovate and adapt to the changing needs. All along
convenience and trust are key pillars for evolution of currencies since ancient time. From the
ancient age barter system was in use and moved to cash based system. At present E- currencies
are making inroads to our day to day activities and the day is not too far where E-Currency will
be the order of the day.

Global currency prevailed in world markets since ancient times. Gold coins were used as a
currency in many empires like Roman, Persian, Silk Road and the spice route to India.
Technological advancements in the new millennium made world to use more than 180
currencies, a myriad of payment options in stores and hundreds of online payment methods. In
the early 1990s, oil companies in US started using RFID chip enabled devices that customers
could wave at the pump to buy gasoline. Charities have raised millions of dollars by enabling
givers to send text-message donations that are charged to their wireless accounts and passed on
to charities by their carriers. More recently, companies like Square have given food truck
vendors and other small businesses the ability to accept credit card payments with a small card-
reading device that works with smartphones and tablets.8 Companies are trying to come out with
ways to make mobile payments simple and easy but yet to witness success. Small companies like
Bling Nation, FaceCash, FoneePays and Obopay have tried and gave it up.9 In 2010, AT&T
Mobility, T-Mobile, and Verizon Wireless announced the Isis Mobile Wallet (renamed Softcard
in 2014), eventually teaming with major card companies. By leveraging near-field

5
Issuance and Operation of Pre-paid Payment Instruments in India (Reserve Bank) Directions, 2009,
www.rbi.org.in
6
A guide to mobile wallets, The Times of India, Aug 23, 2015
7
From evolution to 'pay'volution: Will mobile payments be the next big thing in India? www.firstbiz.firstpost.com
8
“Payments on the go: Making sense of the evolving mobile payments landscape,” PwC, March 2015,
www.pwc.com/fsi
9
Adams, John. “Why Great Mobile Payment Ideas Fail.” American Banker Bank Technology News.
www.americanbanker.com, accessed March 1, 2015.

4
communication (NFC) technology, users were able to pay by tapping a payment terminal with
their mobile device. However, as with other efforts, its potential for success was unclear. While
Google shut down Softcard’s operations after it acquired the company in 2015, it is leveraging
certain aspects of the technology in Google Wallet10.

Banking system in the country plays a key role in non-cash transactions which helps in
enhancing economic prosperity. India’s payment systems had undergone a shift towards the end
of 20th century due to technological innovations. In India, due credit goes to the Reserve Bank of
India for its multi-dimensional approach in enhancing the design and functioning of the
payments and settlement system by its willingness to adopt new technology. Magnetic Ink
Character Recognition (MICR) technology facilitated error-free processing of cheques, while the
introduction of Electronic Clearing Service (ECS), Real Time Gross Settlement (RTGS),
National Electronic Fund Transfer (NEFT) and the Cheque Truncation System (CTS) have
reduced the lead time in realisation of the proceeds from as high as a month to being executed on
the same day.

India has 893 million mobile subscribers with active subscriber base now constituting 86.49% of
the total subscribers according to the January 2014 data released by TRAI11. Payments
technology, aided by the proliferation of the internet as well as the telecom boom, has evolved in
India over the last decade, offering us the convenience of time, place and mode of payment in
conducting our day-to-day monetary transactions.

In 2011, when Google Wallet launched with many options like pay in stores, redeem coupons
and earn loyalty points, all with a tap of the phone. The technology used for it called as NFC
(Near Field Technology) which is universally accepted but availability is restricted with one
phone model and limited acceptability. It is revolutionary in nature. By the turn of 2015, many
advancements taken place like NFC technology used by google then is now available on nearly
all high-end smartphones. Android has supported the technology for years, and Apple recently
got in the game with the iPhone 6.

As emerging economies are adopting changes rapidly one among them is mobile phone
especially smartphone due to affordability. BRICS nations have potential for development in all
fronts. As e-commerce continues its rapid growth in the region, mobile wallets have become one
of the most trusted and preferred ways to pay online. Most of these wallets incorporate multiple
payment methods, from bank transfers to credit cards, debit cards, gift cards and more. That way,
both consumers with credit cards and those without can use mobile wallets. Mobile payment
solutions are part of an evolution, rather than a revolution, in a changing payments landscape.

10
“Payments on the go: Making sense of the evolving mobile payments landscape,” PwC, March 2015,
www.pwc.com/fsi
11
www.trai.gov.in

5
Mobile Wallet Industry Scenario

Mobile phones are transformed our lives by replacing cameras, calculators and paper tickets
from cinemas, railways and airlines. What it has not replaced partly is money. The mobile trend
has also spawned countless mobile payment systems, but most have gained little or no traction
among merchants or consumers in the US. With the stakes rising, this is about to change.
Forrester Research projects that the mobile payments market will jump to $142 billion by 2019.12
These stakes have driven innovators to keep trying with unflagging zeal.

US Mobile payments expected to hit $142 billion by 201913

Peer to Peer : This of type of transactions happen when one person pays another using a mobile
device. The device uses either a preloaded app or a browser –based app to initiate, authenticate
and transfer funds.

In-person : These are done using a mobile device where the buyer and seller are in person,
usually at a brick-and-mortar retail location where the product/service is immediately delivered.

Remote : This kind of payments occur when a buyer purchases goods or services using a mobile
device, but the buyer is not physically present with the seller and the goods are not immediately
delivered (as with eCommerec).

When people are using Ola Cabs for their mobility the rentals are paid in cash. But now a tie up
by Ola with Ezetap has made the payment easy by simply tapping the smartphone. Travelers in
Ola cabs need not rush to nearest ATM counter when they exhaust cash in the wallet. Now one
can simply use the Ezetap’s mobile POS device to make payment by just plugs into a mobile

12
Forrester Research, “US mobile payments forecast, 2014 to 2019,” November 17, 2014.
13
“Payments on the go: Making sense of the evolving mobile payments landscape,” PwC, March 2015,
www.pwc.com/fsi

6
phone. There are many mobile wallet service providers are bee lined to tap the growing Indian
mobile subscribers which has crossed 886 million. Things are looking bright to catch up growing
trend of country’s mobile infrastructure in spite of failures in the past and investors pump money
to this industry.

Since 2010 Indian markets witnessed mobile payment systems but some companies shut shops
due to technological issues and the environment was not conducive for the companies offering
mobile payments. Many of the new solutions are inspired by Square, the company founded by
Twitter co-founder Jack Dorsey to simplify payments in the United States. Now many Indian
firms like Ezetap, Noida based Paytm, Mumbai based Mswipe and Citrus Pay are entering the
market. Venture capitalists are looking this as an opportunity in this changing ecosystem, have
placed their bets in half a dozen such startups in the last 6 months. Mobile payments solutions
companies including Livquik, emPay, Mswipe, iKaaz and Eashmart have raised funding since
October 2013. The major players in the industry are Airtel Money, ikaaz, mRupee, Vodafone m-
Pesa, Oxigen Wallet, Paytm, Mobikwik and Idea Money. The following table provides the
details of funding since august 2013 to till feb 2014.

Table – 1
Table showing Key Funding and New Launches
2013 Aug LIVQUIK a mobile payment startup financed by an angel investor
funding from Snow Leopard Technology Ventures.
2013 Oct emPay a Cochin based firm received funding from a foreign investors to
start a mobile payment system with an investment of Rs27.5 crores.
2013 Dec m-pesa is launched in Gujarat by Vodafone in association with ICICI
bank.
2014 Jan A Mumbai based Mswipe Technologies raised funding from Matrix
Partners and Axis Bank. The amount is not disclosed.
2014 Jan A virtual wallet Paytm was launched by Paytm the online recharge
platform from One97.
2014 Jan iKaaz, a Bangalore based mobile payment solutions, raised seed funding
from a group of angels led by Ananda Kallugadde.
20014 Jan Eashmart raised an undisclosed amount in angle funding from CIIE, IIM-
A’s incubator and two other angel investors.
2014 Jan PayUMoney wallet was launched by its wallet service provider PayU
India.
Source: Electronic Payments 2.0: The Second Coming of Mobile Payments Startups,
www.nextbigwhat.com/electronic-payments-in-india-mobile-payments-2.

7
M/s Forrester Research carried a work to understand customers expected services from mobile
payment service provider which were revealed in its research report titled “US mobile payments
forecast, 2014 to 2019”. The following table is indicating that customers are looking for loyalty
programs points, rewards, coupons and discounts etc. The following table discloses the
expectations of customers in US market.

Table - 2

Consumers expected Services from a E- wallet service providers

Source : “Payments on the go: Making sense of the evolving mobile payments landscape,” PwC,
March 2015, www.pwc.com/fsi

8
Challenges to Mobile Wallet Industry

India has progressed in many fronts in the last two decades and Indian consumers are enjoying
much new technological advancement made by numerous companies. Banking services and
offering are increased many folds. Payment system in India is transforming with help and
support of regulations formulated by RBI. It has proactively helped in the maturing of payments
systems with the introduction of Payment and Settlement Systems Act 2007, spectacular growth
of RTGS, NEFT & ECS settlement systems and introduction of new channels such as mobile in
a calibrated manner. National Payment Council of India initiated many changes including
Automated Clearing House, Centralized Mandate Management System, India Money Line and
Cheque Truncation System. These changes are happening due the consolidation of infrastructure,
harmonization of standards, reduction of clearing cycles etc14.

There are few attributes which made mobile money or wallet popular. The single most advantage
of using mobile money is that it can avoid the pitfalls which are associated with carrying a wallet
such as it can be snatched, misplaced or pickpocketed. A mobile can also be stolen but
technology is helping to locate it (some extent). Hence it can be said that it is better than a wallet.
Another incentive of using mobile wallet is that it will help in decimal payments too hence a
mobile wallet user can avoid going round for change. As per Soma Sundaram, founder CEO,
iKaaz,15 "See, when you make a payment through net banking or through a debit or credit card,
you are disclosing your sensitive bank data on the merchant's site or establishment; it can lead to
unwanted financial happening. But when you use mobile wallets, you restrict the exposure of
your confidential data, which single-handedly wins the case for a service like ours." With the
help of mobile wallet, a customer can preload money and use it to pay for services without
undergoing the two-way authentication process. Currently nearly a dozen m-wallet companies in
the country are competing to become the largest merchant aggregator for customers to make
hassle-free payments.

Another advantage the mobile wallet services provider claim is that customers can use it very
easily by just tapping the smart phone Visa-Visa a net banking or usage of a card either debit or
credit involves several steps for a single transaction. The initiative taken by the Reserve Bank of
India to make online payments simple by introducing one-step authentication may impact the
fast-growing mobile wallet industry and change the way it works16. As of now online
transactions to be successful two ways authentication is must. One is furnishing of card owner’s
bank details and second stage is providing a OTP(one time password) or 3D secure pin which
facilitated in decreasing online thefts. According to the experts17, if the single factor
authentication comes into force, credit cards and debit cards operation will be easy and simple as

14
Jojoe Cherian, Emerging Trends in Payments in India
15
A guide to mobile wallets, The Times of India, Aug 23, 2015
16
Change in RBI norms may leave mobile wallet firms irrelevant , Economic Times, Feb 2, 2015
17
Ibid

9
m-wallets, taking away the advantage the latter currently holds. Financial institutions were at risk
of losing their place in the payments value chain to telecoms, technology innovators, and device
manufacturers, among others. That threat is still alive today, Though the mobile phones
especially smartphone penetration is rapid still there are bottlenecks for mobile wallet to have
wider acceptance due to dependability and speed of internet connection. Internet connectivity
and bandwidth are still challenging the internet growth and reach of customers. Mobile payments
are elbowing their way into an established, complicated ecosystem. Getting financial services
players, card networks, merchants, smartphone manufacturers, and telecoms to collaborate was
never easy. Another limitation could be limit on the amount that can be deposited in mobile
wallets. High value payments transactions have limitations in usage of mobile wallets. Some
consumers may reluctant to switch to a payment system that has not been proven to be more
convenient or more secure than what they already using. Another inconvenience, which Sanjay
Swamy, managing partner of AngelPrime and ex-CEO of mChek, calls "state of transitory flux
effect", is the absence of a single wallet that meets all the requirement of the users. As a result, a
consumer has to store money in innumerable wallets according to the services they regularly
use.18However, some say wallet companies still have an edge in certain cases, like, when the
customer does not have a bank account, or doesn't want to give the merchant access to his/her
bank details. "The entire premise of a prepaid system is built on the concept of financial
inclusion, security and convenience," said Sunil kulkarni, Deputy MD, Oxigen services, a wallet
company that has nearly 3.5 million users and carry out more than one lakh transactions in a day.

ICICI E- Wallet

On 24 September, ICICI Bank Ltd launched Pockets, an application on Facebook. This app can
be used to do financial as well as non-financial transactions while you are on Facebook. Chanda
Kochhar, CEO ICICI Bank said that the bank digital strategy is based on three key pillars –
digital, social and mobile. The bank is digitising its operations and offering banking functions on
digital platform and also extends them to mobile and social media platforms. ICICI is known for
early adopter in the areas like internet banking, mobile banking, tab banking, fully automated
24X7 touch banking, banking on Twitter (icicibankpay) and POCKETS, the digital wallet. The
bank is enthusiastic about E-wallet and hopeful on becoming an important option for payments
in the country. It is an easy payment choice for young customers and confident of attracting new
customers to the bank. Non ICICI bank customers can also download the E-wallet from google
play store, fund it from any bank account in the country and do transactions19.

Pocket has already garnered over a million downloads in the first three months of financial year
2016, with more than half of those transacting on it being new –to- bank customers. Mr. Abhijit
Singh, head of retail technology at ICICI bank said that “we are also pushing Pockets

18
Ibid
19
Sourav Majumdar , Making It Click, Forbes India, October 2, 2015 , PP: 40 - 43

10
aggressively by targeted mobile campaigns”. The Pockets customers base is revealing interesting
facts that as many as 50% are under 25 years of age; 80% are less than 35. Around 70% of those
downloading Pockets are new –to –the – bank customers due to the unified offering on the
mobile phone combines banking transactions, non-banking transactions, ecommerce payments
and social integration. According to analysts, ICICI leadership position will continue despite of
the emergence of new players in mobile payments markets as it has inherent advantage in the
digital era. Pockets mobile app is offering services like Mobile prepaid recharge and DTH,
payment of utility bills, money transfer, gifting, movie tickets booking, View statements, funds
adding, personalization of pockets, Open Pockets Savings Account and tracking of deals and
offers.20

Pocket - How does it work?

As competition is picking up from digital wallet companies and to catch up with market trend
and from the imminent launch of payment banks, ICICI Bank has launched 'Pockets' — an app-
based digital wallet which, on installation, generates a virtual Visa card that can be used for
payments with any online merchant.

Pocket is a virtual card being accepted by any online merchant and it works on existing card
payment platform. With this product, ICICI Bank hopes to take on private non-bank issuers of
digital wallets. The challenge to the non-bank wallets are that the wallet service provider has to
have a tie up with merchants to gain acceptance for mobile money. E- wallet customer cannot
become a bank accountholder though Pocket prepaid account can open instantly. The bank offers
a separate 'zero balance' account within 24 hours of the request after 'know-your-customer'
documents are handed to a bank representative.

Pocket can be used by registering with bank Facebook page (http://on.fb.me/zrLd3z ) and click
on the “Pocket” icon. Registration page will appear after clicking the icon there customers have
to register with their debit card number and personal identification number. Four digit Password
needs to be set in and the same will become login password. After becoming a registered
customer, services can be utilized.

POCKETS – Uniqueness

Pockets app helps in fund transfer. An ICICI customer can send money to any of her Facebook
friends even if she does not have the friend’s bank details. Fund transfer can be done by using a
mobile number or an email ID or a Facebook account. Once you select an option, type the
amount and name of the friend and submit. The receiver will get a coupon number and a
password. You will also have to send a password, which the bank sends you. Using both the

20
www.icicibank.com

11
 passwords along with her bank account number, your friend can get the money credited in her
account. The money transfer system works on NEFT (National Electronic Funds Transfer)
platform. The time required for transaction is similar to NEFT. If a customer wants to pay to a
Facebook friend, the limit is Rs 10,000 per day. For prepaid recharge of mobile phones, the limit
is Rs.1,000 per day. Fund transfer to ICICI Bank account, the limit is Rs.50,000 per day and for
other bank accounts it is Rs.10,000. The duration for the transaction is four to six hours. The cost
will be similar to NEFT transfer—Rs.2.50 plus service tax for amounts up to Rs.10,000.21 There
are concerns about the security of the transactions but ICICI bank states that all banking
activities take place on bank server only.

Conclusion

More than a billion people in emerging and developing markets have cell phones but
unfortunately no bank accounts. Many people who are not having access to banks store and
transfer money through informal networks in spite of thefts and high cost of transactions. The
Reserve Bank of India latest guidelines for payment banks and payments happening to taxis,
ticket bookings and restaurants etc by smartphones and rapid penetration of new technological
advancements in day to day activities are going to transform the payment systems in the Indian
context. Mobile money may fill the gap by offering financial services over mobile. As of now
there are more than 100 mobile money developments in emerging markets and 84% of them
originated in the last three years. Historically the payment industry operated separately with the
system of bank and bank related issuers, acquirers, processors and networks. These players in the
system should play a vital role in developing standards, guidelines for participation in the
industry. Now, however, the old arrangements are rapidly fading and a new industry order is
taking their place.

21
Product crack: Pockets by ICICI Bank, MINT newspaper, Wed, Sep 25 2013

12

View publication stats