Kotak Mahindra Bank has bought 19.9% stake in Airtel’s mobile commerce subsidiary Airtel M Commerce Solutions (AMSL) for Rs 98.38 crore, the bank informed via anotification on the Bombay Stock Exchange. AMSL, which operates Airtel Money, was one of the the 11 payments bank applicants which got an in-principle nod from the Reserve Bank of India in August last year.
At the time of applying for the payments bank licence, Airtel Money said it would form a joint venture with Kotak Mahindra Bank.
Airtel Money posted a net profit of Rs 4.47 crore for the year ended March, 2015. The company had posted a loss of Rs 106.26 crore in the fiscal year ended March, 2014. Income from operations stood at Rs 39.44 crore for the period, a growth of 4.71% from Rs 37.66 crore from the year ended March, 2014.
Airtel Money hasn’t disclosed operational data for India for since March 2014, but an reported an active base of 1.7 million users in India in Q4-FY14, up from 1.3 million in the previous quarter. The total number of transactions made in the country was at 38 million, up 25.8% quarter-on-quarter (QoQ) while the total amount transacted was at Rs 1,364.2 crore.
Other developments in the payments bank space
– Earlier this month, the Public Investment Board approved the Rs 800-crore proposal from India Post for setting up a payments bank and it will be placed before the Cabinet within a month for final approval. In January, as part of its plans for setting up a payments bank, the Department of Posts said it would be setting up 1,000 ATMs and install a core banking solution at 25,000 post offices by March 2016.
– Earlier this month, Paytm also appointed Shinjini Kumar, a former central banker and senior executive at consultancy PwC, as CEO of its payments bank. In January, Paytm appointed Varun Khullar as head of partnerships for its payments bank. Khullar will lead partnerships and build partners in insurance companies, banks and nonbanking financial institutions.
– In August 2015, alternate banking channel FINO Paytech‘s foreign shareholders, such as Intel Capital and Blackstone Group, said they would have to reduce their stake in the company in order to comply with the Reserve Bank of India’s guidelines on payments bank.