Transform mobile payments in India

Telecom deals will transform mobile payments in India

by | Jun 5, 2020 | Buzz of the week, Smart Devices, Telecom

After Facebook–Jio deal, Google and Amazon could also identify their telco partners to future-safe their mobile payments businesses in India.
Share to lead the transformation

Ahead of monsoon’s arrival, the Indian telecom sector is pepping up for an enthralling deals season. While the spotlight is on Jio Platforms, investment speculations are abuzz for Vodafone Idea and Airtel too. These strategic investments (between global internet giants and Indian telcos) have the potential to transform mobile payments in India.

While the Facebook-Jio deal announced on 22 April continues to be a towering one, other significant deals involving Jio Platforms have also taken place. Abu Dhabi-based Mubadala Investment Company has announced to invest ₹ 9,093.60 crore for a 1.85% equity stake in Jio Platforms on a fully diluted basis.

More such investments in Jio Platforms are understood to be brewing.

The Jio Platforms deals have stoked similar developments for other telecom players as well. Earlier, there was a buzz around Google mulling a stake in Vodafone Idea Limited (VIL) and now a likely investment by Amazon in Bharti Airtel is the talk of the industry.

The landfall

It all started with Facebook buying a stake of 9.9% in Jio Platforms, which is a parent to RJio, India’s biggest telco by subscribers as well as revenues. The deal was valued at Rs 43,574 crore.

Four other significant stake purchases in Jio Platforms followed within a month’s time by various global majors, mostly investors. These were: Silver Lake (1.15% stake for Rs 5,656 crore), Vista Equity Partners (2.32% stake for ₹11,367 crore), General Atlantic (1.34% for ₹6,598 crore), KKR (2.32% for ₹11,367 crore), and Mubadala Investment (1.85% for ₹ 9,093.60 crore).

Thus, in a span of just six weeks, a total of ₹87,655.35 crore has flown into Jio Platforms’ coffers for a stake sale of 18.97%. It is understood that the amount would be used by super parent Reliance Industries Limited (RIL) to pare a sizable chunk of the debt it took for the RJio telecom services subsidiary.

Why so bullish on Indian telcos?

With India’s telecom average revenue per user (ARPU) being among the lowest worldwide and the telcos being neck-deep in debts, the enthusiasm of foreign investors seems mystifying at first sight.

In the last few years, several consolidations and shakeouts have brought down the number of private-sector telecom players from around 15 to just three. A number of foreign investors have lost their monies in the process. There even have been speculations that the sector could end up being a duopoly in the long run.

It is also a well-acknowledged fact that not only voice but even data is now commoditized. This means that investments made into pure-play voice or data networks could take very long periods to recoup. In fact, given the high cost of assets (including spectrum and licenses) and the consistently low ARPUs, it is even likely that those investments may never find a profitable return.

This newfound enthusiasm and rush of foreign investors then can’t imply confidence in India’s telecom story. It has to be something much more promising and bigger.

It’s the mobile payments story

A look at the investments made in Jio Platforms shows that the mobile-payments factor has played a driving role. If Google and Amazon decide to invest in VIL or Airtel, that too would be driven by a mobile payments consideration.

As noted in another Better World story (See: Will FB–Jio deal create magic?), while Reliance Jio already has a UPI license for its Jio Money payments platform, WhatsApp is yet to receive a license for rolling out a payment service for all its users in India.

A 9.9% stake in Jio Platforms opens the possibility for Facebook to process mobile payments over WhatsApp using Jio Money as an enabling platform. This could mean a world of difference for Facebook, which has silently watched Google Pay and Amazon Pay amass significant user base and gross transaction values.

According to the National Payments Corporation of India (NPCI), the UPI payments market, including mobile payments, stood at Rs 2.18 trillion for the month of May 2020 alone. Also, Google Pay is understood to be having more than 65 million active monthly users.

Facebook is eyeing a big slice of the UPI pie in India, which as per Better World estimates, will be more than Rs 25 trillion in FY2020-21.

Clash of titans awaited

Despite a strong foothold in India, Google can’t risk undermining Facebook’s capabilities. It will certainly like to bolster its position further in the mobile payments market. Amazon too would like to protect and grow its market share.

So if Facebook has taken a stake in RJio’s parent Jio Platforms, it may be logical for Google and Amazon to identify strategic investment opportunities with other pan-India telcos. The obvious choices would be VIL and Airtel. However, while Airtel hold a UPI license, VIL doesn’t have one (it surrendered the M-pesa license last year). Nevertheless, VIL continues to be the second-largest telco by number of subscribers.

On the BSE, stocks of VIL and Airtel rose 6.41% and 3.89%, respectively, on 4 June, while the Sensex closed marginally lower by 0.38%.

It is another matter that while a 5% stake sale could get Airtel cash worth USD2 billion, a similar stake sale would get VIL just around USD110 million at current valuations. So while a stake sale would enable Airtel to pare a significant part of its debt, for VIL it would only amount to a short lease of life.

This also means that for a VIL deal to be strategically meaningful, a larger stake sale would be required. It remains to be seen if VIL would embrace such an idea, especially at a time when the telco has witnessed some green shoots in the recent months.

That consideration apart, there is a high potential that telecom deals will transform mobile payments in India. This will also change the dynamics between telcos and over-the-top (OTT) companies at large. More about that later.

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NTPC’s push for GW-scale solar power continues

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Request for selection (RfS) documents will be made available at e-Tender Portal from 14 August 2019 and can be accessed up to 2 September for examination and downloading. The technical bids will be opened on 2 September itself. All interested parties are required to get registered with M/s ISN Electronic Tender Services website https://www.bharat-electronictender.com (if not registered already) in order to access the RfS documents.

The date and time of start of reverse auction shall be intimated separately by NTPC.

All bids are to be accompanied by earnest money deposit for an amount calculated at the rate of INR 400,000 per MW. For the 1,200 MW project, this works out to be INR 48 crore.

It seems that the appetite of solar power developers is yet to grow for multi-MW and GW-scale projects. That could be a reason why the responses to NTPC’s earlier projects of 1,000MW or above have been somewhat muted.

NTPC, on its part, has been proactive in either extending or refloating the project tenders. The following additional tenders from NTPC are still open:

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DAE exhibits techs for clean water, environment

DAE exhibits techs for clean water, environment

The Department of Atomic Energy (DAE), Government of India, is organizing a two-day exhibition on DAE spin-off technologies for non-power applications at New Moti Bagh recreation club, New Delhi. The exhibition was inaugurated by the Chairman, Union Public Service Commission (UPSC) Rakesh Gupta here today. The exhibition is open to public for two days on Aug 11–12 2019.

The exhibition is covering technologies developed by the Bhabha Atomic Research Centre (BARC), Raja Ramanna Centre for Advance Technology, Indore and other Units of Department of Atomic Energy (DAE), which are useful for the common man in day-to-day life, e.g., in the field of health, agriculture, water, food security and environment, said a PIB release.

The details of the exhibits are as follows:

Water: DAE has developed technologies for clean water to fulfill departmental requirements and as spin-off developed many techniques which finds applications in ultra-filtration membrane, RO membrane, multistage flash evaporation and water hydrology based on radiotracers. Low cost water filters for removal of all contamination from drinking water have been displayed.

Environment: DAE technologies are finding a lot of applications for Swatch Bharat Mission where bio-methanization and urban sludge hygienization technologies are being deployed across the country. “Nisargruna” plant is a bio-methanization plant for digesting kitchen food waste and green vegetable wastes from agriculture markets to methane gas which can be used for cooking/generating electricity or even for running biogas vehicles. This plant can digest animal waste from slaughterhouse also.

Agriculture: DAE has developed 44 high yielding seed varieties by inducing mutation to suit local weather conditions across the country. DAE has also developed technologies of fertilizer production from bio-sludge and encourages organic farming. The disease resistant, low maturity period and high yielding crops have been well accepted by the farmers. Rural technologies are also being made available to rural youth through ‘AKRUTI’ program.

Health: In health sector there are three segments i) Development of Radio Pharmaceuticals ii) Production & Distribution iii) its implementation for diagnosis and therapeutic application. The treatment of cancer is managed by Tata Memorial Hospital (TMH), a fully autonomous aided institution of DAE, provides comprehensive treatment to cancer patients. Medical devices for Tele-ECG, Bhabhatron–a radiation tele-therapy machine, screening of TB and cancer are on display.

While inaugurating the exhibition, Rakesh Gupta expressed his happiness that such exhibition is being organized in New Delhi. He said that these technologies are helpful in day to day life for common people. He added that Government officials act as opinion leaders, so they should visit the exhibition and understand these technologies. Gupta emphasized that these technologies should be adopted in the whole country at a large scale.

The Secretary, DAE, Dr. K.N. Vyas reviewed the preparations for exhibition yesterday. The former Secretaries of DAE, Dr. Anil Kakodkar, Dr. M R Srinivasan were present. The former Secretary DST and member of Atomic Energy Commission, Dr B Rama Rao, also visited exhibits, along with CMD, NPCIL, S.K. Sharma.

News and all pix: PIB

Reform farm sector and conserve water: Naidu

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Naidu opined that Direct Benefit Transfer would eliminate middlemen and ensure that every penny of the financial assistance given by the government reaches the beneficiaries.

The Vice President said that the Government of India had taken a firm resolve to double the income of farmers by 2022. He added that the government was continuously increasing the minimum support price of food grains to achieve this objective.

He asserted that development would be meaningless until the benefits of progress reached the rural areas and made the lives of our farmers better.

The Vice President also stressed the need for water conservation and said that “Conservation of natural resources like water is essential. For this, a massive campaign of rainwater conservation should be carried out, which will replenish our ground water.”

He cautioned that groundwater levels are continuously falling due to uncontrolled exploitation of groundwater. Due to which the cost of irrigation is increasing. The Vice President also urged the farmers to adopt traditional techniques to support groundwater conservation.

The Governor of Jharkhand, Draupadi Murmu, the Chief Minister of Jharkhand, Raghuvar Das, the Deputy Chairman of Rajya Sabha, Harivansh Narayan Singh, the Minister of Agriculture, Animal Husbandry and Co-operative Department, Government of Jharkhand, Randhir Kumar Singh, and others were present on the occasion.

News and pix source: PIB.

Pradhan releases EoIs for UCO biodiesel in 100 cities

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As reported earlier by Time Green earlier, the EoI was to be released on World Biofuel Day. (See: EoIs for biofuel coming on World Biofuel Day)

The EOI on biodiesel from UCO provides that the entrepreneurs setting up biodiesel plants get remunerative price and assurance of complete offtake of production by the Oil companies. To be launched in 100 cities, EOI will ensure that Rs 51 per liter is paid for biodiesel for the first year, Rs 52.7 for the second year and Rs 54.5 for the third year. The oil companies will also bear the cost of transportation and GST for the first year, said the PIB release for this news today.

Dharmendra Pradhan, along with Chief Guest Dr. Harsh Vardhan, launched a sticker on Repurpose Used Cooking Oil (RUCO) and a mobile app to facilitate the collection of UCO. (pix source: PIB)

Describing biodiesel as low hanging fruit in the scheme of alternate source of energies, the minister said that abundant raw material is available for the purpose (pix source: PIB)

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The minister complimented the Ministry of Health in joining hands with the ministry of petroleum and natural gas, in taking up the projects concerning the health of the people.

Dr. Harsh Vardhan enumerated number of technologies developed within the country to convert the waste into useful products. He said that PMUY has helped millions of people in improving their health. The Health Minister emphasized on enforcement, educating and raising awareness about perils of repeatedly using cooking oil, besides offering incentives for disposing it in productive, useful and safe manner. There is need to develop societal movement around it, he added. He said that the Government has launched Eat Right India campaign, and there is need to extend it Eat Less also.

The RUCO sticker launched today will imply that the establishment having it conforms to the RUCO ecosystem and does not reuse the cooking oil. The RUCO App will enable stakeholders to track and trace all transactions.

Leather Mission launched on World Tribal Day

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leather mission

As part of the Leather Mission, KVIC is giving leather kits to the leather artisans across the nation.

Khadi and Village Industry Commission (KVIC) distributed as many as 50 leather kits and 350 bee-boxes with live bee colonies in tribal-dominated village in Sirohi district of Rajasthan, one of the aspirational districts in India identified by the NITI Aayog, on World Tribal Day today.

While addressing the villagers, KVIC Chairman Vinai Kumar Saxena said that programs like Leather Mission, Kumhar Sashaktikaran Mission, and Honey Mission are the reflection of KVIC’s commitment to uplift the lives of marginalized communities in society.

He said that KVIC is launching a new program ‘Leather Mission’ on World Tribal Day from the tribal-dominated village of Chandala. Under this new program, KVIC will give Leather Kits to the leather artisans across the nation. It will not only increase their incomes manifold but will also inspire the traditional leather artisans who had migrated to other jobs from their traditional skill to adopt this vocation again.”

350 bee-boxes were distributed at the function. Honey Mission has proved as a game-changer in the lives of tribals, farmers, SC/STs and unemployed youths. So far, KVIC has distributed over 1.15 lakh bee-boxes across the nation among the marginalized community, which has provided jobs to over 11,500 people. It has not only increased the income of the bee-keeping farmers but has also increased the yield of the crops by up to 30 percent due to cross-pollination of the honeybees.

3rd global EV conclave held in Delhi

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ev future concept

A futuristic rendition of EV (Representative stock image)

The Minister of State for Heavy Industries and Public Enterprises, Arjun Ram Meghwal, inaugurated the 3rd International Electric Vehicle (EV) Conclave at the International Centre for Automotive Technology (ICAT) in Manesar, Gurugram, today. The Conclave was held to create a knowledge-sharing platform to ensure flow of information at all levels in the automotive sector.

The EV Conclave organized by ICAT in association with India Energy Storage Alliance (IESA) has grown and transformed itself into a global event since its inception in 2017. Owing to the growth of electric mobility and in order to meet the demands of the automotive sector, the EV Conclave is organized with a focus on new trends and challenges in the field of electric mobility.

Addressing the Conclave, Arjun Ram Meghwal, said that the Electric Mobility Mission will be implemented in phases based on feedback from the auto industry. He also promised all support to the industry on policy matters to ensure smooth and efficient transformation of the automotive industry from internal combustion (IC) to electric powertrain. He informed that 3 lakh electric vehicles have already been sold under the FAME India Scheme. He said the provision of Rs. 10,000 crore have been made for electric mobility in the Union Budget of 2019-20.

The Conclave was attended by more than 200 delegates from more than 80 organizations. The next Conclave will be organized in July 2020.

On this occasion, an exhibition was organized in which component manufacturers, system suppliers and service providers showcased their products and services to promote self-reliance, encourage designers and promote innovations in the electric vehicle industry in India.

Arjun Ram Meghwal also inaugurated various new facilities including Photometry Lab for General Lighting and Power Train Engine Test Cell (ETC)- Expansion. In the expansion of the Photometry Lab for general lighting, various performance and safety testing facilities like mirror Goniometer, LED testing facilities were also inaugurated. Powertrain ETC lab expansion includes two transient and five Eddy current dynamometers-based test cells for functional validation of engines. (News source: PIB)

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