Prepaid International Forum (PIF) India today announced that it has extended its membership admission policy to include mobile operators. The decision reflects the increasingly important role mobile operators play in the prepaid market in India.
A number of analysts have stated that prepaid mobile payments have the potential to unlock the buying power of large numbers of unbanked individuals in India who have access to a mobile phone. In addition to the potential impact on e-commerce, increased mobile penetration in India opens up new possibilities for mobile payments at POS and services such as remittances, where workers in the city may transfer funds to family members in their home village.
According to Jupiter research the global mobile payments market could reach $670 billion by 2015. Though mobile payments are a global phenomenon, they have particular relevance in a market like India. A recent TSYS report authored by Amit Sethi, Managing Director of India and Southeast Asia, TSYS, and Co-Chairman of PIF India, revealed that more than 70 per cent of the population live in rural areas with limited or no access to basic banking services. At the same time, in 2011 there were more than 800 million mobile phone subscribers and a third of these were in rural areas. The report concluded that "the ubiquity of mobile phones in rural India provides financial institutions with an attractive alternative to expensive infrastructure improvements". What's more, consumers in India are already familiar with the prepaid model.
A number of partnerships have already been formed between financial institutions and mobile phone operators. For the banks, such initiatives provide an effective way of reaching the unbanked market, while for mobile operators they deliver a new revenue stream.
Since its establishment in 2009, in addition to banks, PIF India's membership has been extended to include non-bank players, card schemes and more recently technology solution providers.
Commenting on today's announcement, PIF Chairman Robert Courtneidge said "We feel sure that the extension of the forum's admission policy will bring an important new perspective to PIF India through an increased focus on the on the integration of prepaid and mobile solutions and attention to the role of mobile operators in the prepaid value chain. It will also allow the forum to further promote the role of emerging payment solutions."