Expanding banking points, product lines, debit cards in rural areas: Airtel

Airtel Payments is experiencing a “strong demand tailwind” and will ramp up its banking score and deepen product offerings this year as it looks to grow customer numbers and average perception per user, CEO Anubrata Biswas said.

Airtel Payments will also launch the physical debit card for rural banking customers in the September quarter (Q2FY24), having already launched it in urban markets.

“We are seeing strong demand winds, maintaining our focus on consumer choice, sustainable model and costs…the opportunity is limitless as long as we remain focused on solving consumer needs and problems,” Biswas told PTI.

The Payments Bank grew at a compound annual growth rate of 35-40 per cent between mid-2018 and mid-2023 and is forecast to close the June quarter (Q1) at an annual run rate of Rs 1,600 crore.

“Today our ARPU is down in the 20s (in rupees terms), and as our product reach increases and our cross-selling efforts increase, our ARPU will go up. With 56 million users now, we believe the scale of inclusiveness Digital and financial in India is 500 million (users) opportunities, of which 300 million are in rural India and 200 million are in urban India.”

Solving consumers’ problems well with banking solutions, therefore, provides a huge scope for growth for the Payments Bank, he said, adding that Airtel Payments Bank now serves the financial and digital inclusion needs of tens of millions of customers across rural and urban areas of India.

“If you grow earnings per user growth and user growth together, we should definitely see, if not equal, at least high growth rates from our model,” Biswas said.

It is worth noting here that for the financial year 2023, the bank reported revenue growth of 37% to Rs. 1,291 crore, with profit growing by 141% to Rs.21.7 crore.

Airtel Payments, in a May statement, said in its 2023 financial performance that customer deposits grew by 59 percent year on year to Rs 1,865 crore, buoyed by a “healthy addition” of new users.

“Airtel Payments Bank recorded significant Q-o-Q growth in revenue for FY23, with the fourth quarter (Jan-March 23) being the strongest with revenue at Rs.379 crore, a sequential growth of 19 percent over the previous quarter,” the company said. In its statement issued on May 18.

The bank recorded growth in all three core business segments, namely the urban digital consumer, the under-banked rural sector, and industries and businesses.

It has recorded strong appetite for its product offerings such as digital payments, money transfers, insurance, referral credit, collection management, services and others.

Going forward, Biswas said, ARPU will rise with diversification of revenue sources. “We are in the process of launching a physical debit card for our rural consumers that will be stored at the point of banking and distributed. This is scheduled for the second quarter.”

The physical debit card is ordered online in urban areas, but in rural areas, where individuals deal with the retailer, the point bank will offer the debit card, which can be used to withdraw money by swiping it at a small ATM.

“Rural users will feel more confident with a physical debit card,” he explained.

“Airtel Payments Bank is committed to ensuring digital and financial inclusion across India,” he said, noting that the model is in line with the needs of all Indians, especially if microcredit is allowed, which will have a transformative impact on the country. .

Airtel Payments Bank is a profitable multi-sector financial bank operating with a banking license, offering a range of banking solutions through a network of 500,000 banking points in the country and its digital platforms.

Earlier, the bank rolled out face authentication for account opening, AePS, debit cards, and small ATMs. Additionally, Airtel Safe Pay, the Rewards123 plan and checking account solutions pay with great traction, according to the company.