Covid-19 is a major growth engine for Bharti Airtel’s payment banking arm, he said, as customers want banking solutions closer to home and also seek convenient and more secure digital payment options. .
“Airtel Payments Bank is confident of reaching the breakeven point this year, aided by the increasing scale of its model which relies on deep distribution supported by investments in digital infrastructure,” said the executive to ET on condition of anonymity.
In 2020-2021, APB saw 60% year-over-year growth in savings account deposits and its Active Income Generating Customer (CER) base grew by over 77% year-on-year to reach 55 million.
The company recorded 32% year-on-year revenue growth to Rs 627 crore, and its services were one of the main reasons for reducing the churn rate of mobile subscribers for parent company Bharti Airtel, said company insiders. Airtel’s monthly customer churn rate fell to 2.2% in the quarter ending March, from 2.6% a year ago.
âAPB has taken another giant step towards profitability this year,â said Managing Director Anubrata Biswas, adding that the combination of its brand and innovative products supported by distribution reach and technology positioned it well to accelerate. still growing.
He said Airtel innovations such as ‘Safe Pay’ are a major service differentiator amid Covid-19 and APB has also become a major provider of fundraising services for institutions. and businesses and sees it as a major engine of growth.
Bharti Airtel CEO Gopal Vittal recently warned the telecoms operator’s 321 million mobile users of increasing cyber fraud cases and urged them to use Airtel Safe Pay, which can be activated anytime. using APB services. In December 2020, Bharti Enterprises chairman Sunil Mittal said Bharti Airtel could upgrade its payment banking license to that of a small financial bank at some point to enter the lending business and attract larger deposits.
If that happens, it will be able to use the deposits of its 55 million users more profitably, industry executives have said.
A payment bank may provide services such as savings accounts, remittances, and other payment options, but current regulations do not allow it to lend money. For example, ABP now offers digital payments and money transfers as well as value-added products such as insurance, direct benefit transfer credits, Aadhaar payment systems and pension plans.
Company executives, however, did not comment on the specific timelines for converting APB to a small financial bank.