Under new guidelines issued by the Reserve Bank of India, the country’s mobile operators will be banned from implementing mobile payments services into their established retail networks.
Analysts have noted that these new guidelines could damage the business case for mobile banking. The additional revenue that such services would generate for operators would be offset by being unable to deploy mobile banking via their existing retail outlets.
Investing in new distribution channels would likely prove too much of a financial deterrent for most operators. Existing mobile money offerings from market leaders Bharti Airtel and Vodafone India have seen their success limited in comparison to equivalent services in Africa, largely due to regulation.
In addition, several Indian operators have requested clarification from the RBI and the Department of Telecom over whether revenue from mobile banking constitutes part of their annual gross revenue. If this is the case, it would affect their licence and spectrum usage fees.
The Cellular Operators Association of India has stated that if a separate delivery channel is required, then mobile payment revenue should not be considered part of an operator’s annual gross revenue. The representative noted that in this case, a permit should only be required from the RBI, not the DoT.