[Press Release] Fino Payments Bank, a neo bank focusing on digitization of cash, in association with a consortium of fintech partners has introduced NFC-based contactless payments solution for mass transit systems, especially state bus transport services.
Buses run by state road transport corporations (SRTC) are the most preferred means of travel for majority of people in rural and semi-urban areas where cash is used to purchase tickets. Fino, which has over 80% of its banking network of 2.75 lakh points in villages, aims to tap the huge opportunity to digitize cash used in mass transit systems.
As enhanced public health safety measures are being taken to avoid spread of pandemic, transport operators will have to think effective alternatives that are convenient and safe. Fino’s NFC-based prepaid smart card ecosystem facilitates contactless or tap and go payments enabling cashless ticketing. The contactless and cashless mechanism helps maintain social distance protocol and avoid risk of cash-led transmission of the virus.
“We see a huge opportunity as contactless payments can digitize fare collection for state road transport corporations across India. Our bespoke solution developed along with our fintech partners helps transport operators convert their existing ticketing hardware infrastructure into NFC compatible with minimal incremental investment. We are already working with Maharashtra’s SRTC and are keen to extend the benefits of our contactless payments solution to other state transport corporations as well. We believe this is right time for going contactless. If not now, then when, is the question we ask ourselves, says Ashish Ahuja, COO, Fino Payments Bank.
The NFC-based prepaid smart card solution can also be used offline for fare collection, which is beneficial in locations having connectivity issues. Along with their own bus depots, SRTCs can leverage Fino’s state-wide banking network as touch points where customers have the convenience to recharge their smart card both in online and offline mode. With cash being digitized, contactless digital payments helps efficiently manage businesses that are predominantly cash based.
Fino has already issued more than 3 million NFC-enabled smart cards that are accepted across 20,000 Maharashtra State Road Transport Corporation (MSRTC) buses. It may be noted that in pre-covid days MSRTC buses used to transport over 7 million passengers daily. Commuters of public bus transit systems using contactless payments will bring about a transformative change in the adoption of digital financial services, especially by senior citizens and students.
Fino Payments Bank has partnered with fintech firms such as City Cash for developing the contactless payments solution for mass transit systems. Earlier, Fino Paytech, the promoter of Fino Payments Bank had invested in City Cash in its efforts to nurture and support the fintech ecosystem.
Potential market:
According to ASRTU (Association of State Road Transport Undertakings) members collectively operate a fleet of 150,000 buses carrying over 70 million passengers every day across urban and rural areas. Further, with various initiatives on the anvil such as Bus Rapid Transit System (BRTS), Road Transport Ministry expects increase in the passenger ridership to 120-150 million per day.
It is estimated that the addressable market for all the state road transport bodies put together is around Rs 50,000 crores, which is largely done in cash.
With such a huge opportunity to digitize cash and facilitate cashless travel, the consortium’s NFC-based contactless payments ecosystem will play a critical role in turning India’s trillion dollar digital opportunity as stated by MEITY, a reality.