Amidst ongoing uncertainty over the future payments bank in India, early adopter platforms, in this space, are showing some resistance.
After achieving the target of the digital transaction set by the Ministry of Electronics and Information Technology (MeitY) in FY19, Fino Payments Bank, Airtel Payments Bank and Paytm Payments Bank have managed to achieve their target once again as on June 30, 2019.
While Fino has surpassed the target with 193% of digital transaction, Paytm and Airtel have achieved 106.54% and 96.98% of their target respectively.
In FY19, Airtel was the best performer in MeitY’s digital transaction scorecard by overachieving the target at 211%, followed by Fino and Paytm Payments bank with 209% and 122% respectively. Apart from the top three players, Jio Payment Bank has posted an average score with achieving 59.26% of the target.
Notably, Paytm Payments Bank is the only players to become profitable among all payments banks operational in the country.
Zeroing in on India Post Payments, the government-owned entity was the worst performer amongst the payments players by achieving only 1.8% of the overall target.
In MeitY’s performance table, only Fino’s performance was categorised as ‘Good’ while Airtel and Paytm were in ‘Satisfactory’ bracket.
India Post, which was reportedly pivoting its business to small finance bank, along with Jio Payments Bank, has been remarked as ‘Unsatisfactory’ in the table.
Lack of interest by consumers, restrictions on lending and accepting deposits are some of the reason behind downfall in the figure. Besides, the need for regulation is the next hurdle.
Moreover, payments banks (PBs) are allowed to invest only in government securities, which offer lesser returns compared to other avenues such as mutual funds.
Closure of Aditya Birla Payments Bank and Vodafone m-Pesa had raised many eyebrows over the business viability under the existing framework.
As a result, only 6 out of the 11 of payments banks are now operational.
Recently, RBI Deputy Governor Vishwanathan said that payments banks are themselves responsible for the failure in the business. He also refuted any changes in the regulation.