Aadhaar

IDFC to convert ration shops into banking outlets

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Private sector lender IDFC is converting ration cards into banking by recruiting Public Distribution System (PDS) agents as business correspondents. With several states pushing the concept of ePDS agenda, where payments are transferred electronically to distributors, the private bank is looking for an opportunity to convert distributors into partners, rather than customers.

IDFC Bank has received the mandate from Andhra Pradesh and Maharashtra governments for cashless payment at PDS outlets and the bank is now in talks with the Haryana government, reported The Times of India.

Reportedly, the bank had recently rolled out IDFC Aadhaar Pay in association with the Unique Identification Authority of India. The service includes the use of a point of sale device that has a fingerprint scanner, which facilitates account-to-account transfers using Aadhaar. The customer does not need to swipe a debit card, remember passwords or own a cellphone and there are no transaction fees.

“In rural and semi-urban areas, where customers need ‘assisted digital’ banking formats, IDFC Bank’s Aadhaar merchant solution is a perfect fit. The merchant benefits from the medium—as this is a new AEPS payment railroad, it has no merchant discount rate attached to it and can provide the service to customers without having to pay the bank a transaction fee,” said Rajiv Lal, Managing Director and Chief Executive Officer , IDFC Bank.

The private bank, which received its banking licence in August 2014, is enrolling over 3,200 PDS outlets in Andhra Pradesh into its cashless system and has deployed micro ATMs in such outlets. The bank has started working with the ration shop network in Maharashtra, where it has received the mandate to implement cashless PDS in 14 districts in the state.

 

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