State Bank of India (SBI), the largest bank in India, announced that it will be launching its mobile wallet service “SBI Buddy” on Tuesday. SBI Buddy will be competing with ICICI Bank's Pocket, HDFC Bank's PayZapp, Paytm and MobiKwik. The move is a significant one because the mobile wallet business in India is growing rapidly.
SBI has a customer base of more than 280 million of which 16 million are mobile banking customers. We feel that SBI Buddy will be widely accepted by users and merchants because SBI is considered as one of the most trusted banks among common Indians. To achieve success, SBI has already partnered with several merchants. Once a user of SBI Buddy downloads the mobile app in his or her smartphone, he/she does not need to download the mobile app of the merchants where SBI Buddy will be accepted.
SBI Buddy has the following features:
- Anyone can upload money into the wallet via debit card, net banking or IMPS.
- Users can do P2P payments.
- The app allows a user to pay mobile/DTH bills.
- Users can also buy flight, bus and movie tickets directly through the app without logging into the merchant app.
- The solution will be available on Android OS.
SBI Buddy will allow users to keep a maximum balance of INR 10,000 at a time. The bank has also capped the total reload amount in a month and the top up amount per transaction to INR 10,000 per month. The daily limits on merchant transactions are at INR 15,000 while the monthly limits are at INR 20,000. For P2P fund transfers, a user can send a maximum of INR 5,000 per transaction or per day and INR 20,000 per month.
Initially, the mobile wallet segment in India was dominated by prepaid issuers who received licenses from the Reserve Bank of India (RBI) to operate close loop wallet services in the country. The maximum transaction value per transaction is capped till INR 10,000. Paytm, MobiKwik, Citrus Pay, Oxigen were the frontrunners.
Banks realized that if they do not operate in the mobile wallet segment, they might lose a sizeable market.
Among banks, ICICI bank was the first to introduce “Pocket,” a mobile wallet solution that integrates prepaid card and a basic savings bank account. HDFC Bank partnered with Chillr and introduced a similar payments solution through which HDFC Bank customers could make instant fund transfers to any contact in their phone book. Later in June, the bank launched the PayZapp app, an all-in-one mobile payment and money transfer app, through which HDFC bank customers can do mobile commerce, pay bills and P2P payments. SBI Buddy will be the next to be added to the list.
As large banks like SBI and HDFC launch their digital wallet services, the Indian mobile wallet market is on the rise with the wallet war intensifying at the same time.