About Airtel Payments Bank Unlisted Shares

Airtel Payments Bank Limited (APBL) is formerly known as Airtel M Commerce Services Limited. APBL is engaged in providing financial services. The company is engaged in the business of providing services of the semi-closed prepaid instrument under license from the Reserve Bank of India. APBL offers a prepaid payment system that runs under the name ‘Airtel Money’. The company offers a prepaid payment system for e-commerce, lifestyle, apparel and recharge. The company was incorporated in 2010 and has its registered office located in New Delhi.

Overview of Airtel Payments Bank Unlisted Shares

Snapshot

Airtel Payments Bank is a subsidiary of Bharti Airtel, one of India's largest telecom companies. It was launched in 2017 and was the first payments bank to go live in India after the Reserve Bank of India (RBI) introduced the concept of payments banks in 2014. It aims to drive financial inclusion by providing accessible banking services such as savings accounts, fixed deposits, payments, and remittances, to the unbanked and underbanked population of the country. With its extensive network, leveraging Airtel's vast telecom infrastructure, the bank offers digital and traditional banking services to millions of customers across India. It is the fastest-growing digital bank in the country and ranked number six in mobile banking.

Services

1. Savings and Current Accounts:

- Digital Savings Account: Customers can open an account with a zero minimum balance requirement, offering interest on deposits and easy access to their funds via the Airtel Thanks app.

- Rewards123 Savings Account: A premium savings account offering benefits like higher interest rates, cashbacks on transactions, and other rewards.

2. Money Transfer and Payments:

- Instant Money Transfer: Facilitates quick and easy transfers to any bank account across India.

- Utility Bill Payments: Customers can pay utility bills, recharge mobile phones, and pay for other services through the Airtel Thanks app or at designated outlets.

- Merchant Payments: Enables digital payments at a wide network of merchant partners through QR codes, UPI, and other digital methods.

3. Insurance and Financial Products:

- Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY): Provides life insurance coverage at affordable premiums.

- Pradhan Mantri Suraksha Bima Yojana (PMSBY): Offers accidental insurance coverage.

- Fixed Deposits: In partnership with financial institutions, Airtel Payments Bank offers fixed deposit options with attractive interest rates.

4. Airtel Safe Pay:

- A unique security feature that ensures additional protection for UPI and net banking transactions, making digital payments more secure.

5. Airtel Money Wallet:

- A digital wallet that allows users to store money and make quick payments for a variety of services, both online and offline.

Digital Initiatives

Smart Watch Launch: On March 19th, 2024, Airtel Payments Bank made its debut in the smartwatch market with the launch of its first-ever wearable device. This strategic move marks the bank's entry into the rapidly growing smartwatch segment. It is developed in collaboration with Noise and Mastercard and features NFC technology, enabling users to make contactless payments of up to Rs. 25,000 per day.

Industry Overview

1. Indian Payment Gateway Market Growth: The Indian payment gateway has been growing at a compound annual growth rate (CAGR) of 15% from 2020 to 2025.

2. Global Digital Payment Market Size: The global digital payment market was valued at USD 96.07 billion in 2023 and is expected to grow at a CAGR of 21.1% from 2024 to 2030.

3. Increased Internet Penetration: Rising internet penetration and awareness of online transactions are driving the growth of payment gateways in India.

4. Shift to Online Payments: Consumers' preference for hassle-free online transactions is contributing to the rapid adoption and expansion of the payment gateway market.

5. Global Digital Payment Adoption: By the end of 2021, over two-thirds of adults worldwide were engaged in digital payments, a trend expected to continue growing.

6. Drivers of Global Digital Payment Growth: The global surge in digital payments is fueled by the increased use of smartphones, better internet accessibility, pandemic-induced cashless transactions, and supportive government policies.

Swot Analysis

Strengths

1. Extensive telecom infrastructure leverage

2. Strong parent company backing (Bharti Airtel)

3. Robust digital payment solutions (e.g., Airtel Safe Pay)

4. Wide network of retail and online touchpoints

Weaknesses

1. Limited to existing Airtel customers for certain services

2. Dependency on technology partners for some services

3. Lower market penetration compared to traditional banks

4. Regulatory challenges and compliance costs

Opportunities

1. Expanding digital financial services market

2. Increasing financial inclusion in rural areas

3. Growth in contactless payment adoption

4. Potential for partnerships with fintech and e-commerce platforms

Threats

1. Intense competition from other digital banks and fintech firms

2. Cybersecurity risks and data privacy concerns

3. Regulatory changes impacting operations

4. Economic fluctuations affecting consumer spending

Recent News

Airtel Payments Bank announced its consolidated results for the first quarter ended on 30 June 2024. In a significant milestone, for the first time, the Bank’s quarterly revenue grew to ₹610 crore, up by 52% YoY. The Bank’s net profits stood at ₹7.2 crore, up by 41% YoY. The Bank’s Monthly Transacting Users (MTU) exceeded 88 million giving a boost to customer deposits, which grew by 53% YoY to ₹2,943 crore.