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Should you go for mobile money?

Adarsh Gopalakrishnan | Updated on April 14, 2012

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Airtel, which offers this service, does not levy any charge on transactions for movie tickets, shops and restaurants but booking a travel ticket online could cost you up to Rs 50.

Imagine you're enjoying a cup of coffee with a friend at a cafe. The waiter comes with the bill and you realise you're broke.

Your friend too has just about enough cash to cover the bill and is on the edge of a liquidity crisis.

You dread the walk to the nearest ATM to get the mere 50 bucks you owe your friend. Thankfully, you now have a choice. You can pull out your phone and a few button taps later your debt can been made good. Airtel, through its recently rolled out Airtel Money, offers such a service where your phone doubles up as a cash wallet.  

Account options

Airtel's offering does not require internet. The company uses a SMS-like interface to help you transact. There are two account options.

An ‘Express' account lets you undertake a basic set of transactions such as paying your electricity bill, water bill and transacting on certain travel portals.

For Rs 50, you can register for the ‘Power' account option which additionally lets you send money to bank accounts through NEFT and other registered Airtel Money users. Airtel Money service requires a special SIM card which has more memory.

This SIM card is also required for transactions of over Rs 5,000. You can get one of these SIM cards for your existing numbers at Airtel relationship centres. Enabling the express account is a simpler process and can be done online. Registering for the more useful ‘Power' service involves providing the requisite ID proof, KYC form and a sign-up sheet at an Airtel relationship centre.

Security for the Airtel Money payments is through a four-digit M-Pin which you key in every time you use it.



Getting started

To start using the service you need to load your Airtel Money account (identified by your cell phone number). You can use the Airtel Money site to transfer a maximum of Rs 50,000 to your ‘Power' account (Rs 10,000 max for the ‘express' account). This is also the maximum amount you are allowed to spend in a single day. . Else, visit an Airtel centre and make a physical ‘top-up' of your account, up to a maximum of Rs 5,000.

To transfer an amount, you hit *400# on your phone and a simple interface pops up. Following the numerical instructions is a cinch. While several utilities in Tamil Nadu, Karnataka, Maharashtra, Delhi and Madhya Pradesh are included, you have to register a utility or biller through the mobile interface before paying the bill. Retailers include Nike and a handful of restaurants. .   

Expensive proposition?

For small transactions, Airtel Money may prove costly. A transaction between Airtel Money customers costs Rs 5 for amounts up to Rs 500. Above the Rs 500 threshold, a flat charge of Rs 10 is slapped. Booking a travel ticket online could cost you up to Rs 50. Airtel does not levy any charge on transactions for movie tickets, shops and restaurants. But the fine print does indicate that vendors could possibly charge you extra for using Airtel Money.  

Besides, there is no way to redeem your cash from your account barring an NEFT transfer. Sending money to a bank account is a costly affair with Airtel taking a 2 per cent cut on the transaction amount. So shifting Rs 5,000 from your Airtel Money account sets you back by Rs 100. Compare that to the Rs 5 charged for NEFT transactions below a lakh of rupees threshold. Restrictions on individual accounts include a monthly cap of Rs 10,000 in the total amount you can send to another Airtel money user or bank account. The small benefit of having an Airtel Money account however, is the cash back offers on the group's own products. You can get 5 per cent off your pre-paid top-up or post paid bill payment if you use Airtel Money.

adarsh@thehindu.co.in

Published on April 14, 2012

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