Federal Bank, a private sector bank, has launched the Interbank Mobile Payment Service (IMPS), a real-time fund transfer facility through mobile phone, in association with National Payment Corporation of India.
The new facility was launched by Dileep, Malayalam film actor in the presence of Shyam Srinivasan, managing director and chief executive officer of the bank.
Inter-bank Mobile Payment Service (IMPS) is operated by National Payment Corporation of India’s (NPCI), which is the umbrella organisation for all retail payment systems in the country owned and operated by banks.
There are 12 other banks which offer this service including SBI, ICICI, Axis Bank, Kotak, Bank of India, HDFC, Lakhsmi Vilas bank, Union bank of India, Yes Bank, Corporation bank, Indian Bank, and Oriental bank of commerce. Allahabad bank is also in the process of starting this service.
At present, a majority of interbank mobile fund transfer transactions take place through the National Electronic Fund Transfer (NEFT) system. Under this, the transactions are processed and settled in batches during the working hours from 9am to 7pm, and not in real time.
IMPS scheme, allows customer to transfer funds instantaneously to any other bank account using mobile phone. The other account, however, needs to be IMPS registered as well. The service is offered without any restriction on timings.
The customer who wants to transfer funds or to receive funds has to register for mobile banking with the bank. Once registered, an MMID (Mobile Money Identifier) is generated. The MMID is a seven-digit number issued by the bank upon registration. Customer also has an option to register for receiving funds only.
The unique combination of mobile number and MMID is all that is required for the transaction to take place. The customer will simply need to enter the beneficiary’s mobile number and MMID along with the amount to be transferred. Both the remitter and beneficiary will receive SMS confirmation of the transaction.
These transactions can be initiated by downloading the mobile banking application of customer’s banks in his mobile or by sending an SMS in a predefined format. However using SMS only Rs 1000 can be sent everyday and there is a cap of Rs 5000 for a month. This cap is higher with the use of an application (downloaded on the phone), and allows transfer funds up to Rs 50,000 daily.
The service providers a unique preposition to bank and users, the banks gain as the service reduces the cost of fund transfer, customers benefit as the save on time. The service was launched in the last quarter of 2010.