Axis Bank launches mobile wallet to shop, pay and bank

Now, Axis Bank will allow customers - both account and non-account holders - to compare and shop, split bills, transfer money and even share their mobile banking wallets. This will be through the lender's mobile banking app, 'LIME'. The country's third-largest private sector lender launched the app on Friday.

Rajiv Anand, group executive and head retail banking, Axis Bank, said this app would allow more customers to have a seamless payment experience online. "This app offers high customer engagement by having facilities across different needs. The same app can also be used to pool money to buy gifts or for group travel by friends." The bank is targeting about a million downloads of the app, which is available for Android devices and would be launched for Apple devices soon, he said.

The lender has been focusing on the digital medium like its peers. Anand said about 47 per cent of their transactions are on the digital platform. About 12-13 per cent of the total transactions would be through mobile, he added. According to RBI data, for the month of May, Axis Bank recorded Rs 1,981.50 crore worth of mobile banking transactions.

In LIME, once the user keys in the details, the wallet is created. This can be used for an array of services including money transfer, which can be withdrawn from any Axis Bank ATM anywhere in India using a PIN. Using the LIME wallet, one can add moneAxis Bank, the country's third-largest private sector lender, believes that going ahead, base rate may come down further. Base rate is the benchmark rate to which all lending rates are linked.

"There will be further room for base rate cut in the next couple of months…. Given that inflation has been coming down, there is room for interest rates to come down," said Shikha Sharma, managing director & chief executive officer of Axis Bank.

In July, retail inflation fell significantly to 3.78 per cent whereas the wholesale inflation for July fell for the ninth straight month to a historic low of (-)4.05 per cent. At present, Axis Bank's base rate is 9.85 per cent. Recently, the lender also reduced the deposit rates by 25-50 basis points but it said it would take some time to have an impact on the cost of funds.

"We are only reducing the cost of deposits only on the new deposits therefore it will take some time to have an impact on our overall cost of funds," said Sharma.

In order to improve the monetary transmission, the Reserve Bank of India (RBI) has also proposed the new regime for calculating base rate which Sharma says is unlikely to have "a significant difference" to their base rate. According to the new draft guidelines, banks will have to follow the marginal cost of funds method for base rate computation from April 1, 2016. At present, banks can choose to compute base rate on the basis of average cost of funds or marginal costs.

Axis Bank has also said it is exploring partnership tie-ups with payments banks. Recently, RBI granted licences to 11 entities for payments banks.

"We are very happy to partner and do partnerships wherever there is synergy and we are very happy to explore that," Sharma saidy from credit/debit cards or net banking.

Further, one can also share their wallet with their family members wherein a fixed amount is set for any fixed period, to be used by the receiver for personal needs.

For customers who often shop offline, LIME would offer a MasterCard card through which they can make payments at any merchant that accepts cards.

This app also allows users to transfer money without using the Near Field Communication (NFC) platform. A feature called 'NearPay' allows one to transfer money by just bringing two smartphones near each other. Once the user has to request for money via the app which is then accepted by the other user. This is followed by an instant transfer, which Anand said is using sound waves that are unique to each mobile.

Banking is enabled by a feature wherein one can open an Axis Bank savings account which unlocks additional features for the customer.

One can use the 'Piggy Bank' feature which rounds off change during wallet usage and invests it directly into a high yield deposit.

Further, they can choose a goal (like buying a car, home) with amount required and time to goal and then allocate appropriate funds for it.

Several other lenders, such as State Bank of India, HDFC Bank and ICICI Bank have also launched digital payments solutions which includes mobile wallets.