Now available in New Delhi and in conjunction with ICICI Bank, Vodafone is offering customers M-Pesa, a mobile payments service initially launched in Africa. It includes options such as transferring money to any mobile device, remitting money to a bank account, payments for utility bills, along with depositing and withdrawing cash from designated outlets.
Vodafone customers need to deposit 200 rupees (US$3) to register for the service and each transaction costs 10 rupees (US$0.15). There are also additional fees for transferring money, reports The Times of India.
Vodafone expects the service and features to go viral, and as such, they are planning to quickly launch the service within the next few days in both Mumbai and Lucknow. Personally, I'm surprised that metros such as Chennai and Bangalore didn't make the initial launch list. Bangalore itself has a high penetration of IT companies and IT executives who are known to be tech savvy, and as such, one would assume these services would appeal to them. However, the service was initially launched last December and is expected to cover all of India within 12 to 18 months.
Great, so both Airtel and Vodafone are offering the same features and services to customers. The real question is it really necessary? If you're a customer with an existing data plan on either carrier, you could very easily make utility payments online, in addition to either online or mobile banking. All of the leading Indian banks have mobile banking apps, as does ICICI Bank.
So what's the novelty with M-Pesa?
Traditionally, M-Pesa solutions are more suited for consumers and customers in rural settings who either don't have easy access to make direct utility payments, or even banks. For rural India, M-Pesa saves companies time, money, and resources of setting up branches and offices as these services can be conducted online, or with mobile devices.
That being said, Airtel is still in the lead when it comes to features. For example, with Airtel Money, customers can use their devices to payment at retail shops, online shopping, and purchasing movie tickets. Furthermore, with Airtel Money, you can also make payments for any Indian mobile operator and also direct to home (DTH) satellite television services. A recently added feature is booking railway tickets across India.
Currently, Vodafone doesn't have all these features. Also, Airtel offers customers three different accounts with Airtel Money: Power Account, Express Account, and Super Account. With the Power Account, customers can use up to 50,000 rupees (US$773) a day for payments, while with both Express and Super Accounts, customers can use up to 10,000 rupees (US$154) a month for payments. The Express Account is the easiest and quickest to sign up for, as it can be done directly from the Airtel Web site. For a Super Account, a customer needs to visit a Airtel Money Axis Bank outlet and for a Power Account, a customer needs to visit a Airtel Money outlet.
To be frank, I don't know too many people who use M-Pesa solutions in metros such as New Delhi. Sure, Airtel has spent a lot of money advertising Airtel Money, but I just don't see people using it. Perhaps this is why Vodafone is launching their M-Pesa solution in New Delhi so late in the game; they know there isn't a huge demand but it's better to have this feature available in New Delhi since it's available elsewhere, such as Kolkata.
At the same token, with increased competition between Airtel and Vodafone for the same service, this could increase consumer awareness but time will tell if this feature will really catch on. In my opinion, both carriers should focus their energies on introducing M-Pesa in rural India instead, as I feel it would be more viable there.