Ignore both Airtel Money and M-Pesa
Vodafone and Airtel are aggressively pushing their expensive mobile wallets, but both services pale in comparison to the cost and convenience already offered by net-banking.
Banking is much more convenient than ever before. Numerous payment options exist for any transaction. There’s phone banking, net banking, ATM banking, branch banking. Yet, both Vodafone and Airtel believe consumers will be interested in using their phone banking services. Both service providers have tied up with major banks to let you use their network to perform banking transactions. The strange thing though is that while your bank would already offer you such services either free or at nominal rates, Airtel and Vodafone both expect you to cough up fees each time you use their service. First, though, let’s examine how they work.
How they work
M-Pesa and Airtel Money are both mobile wallets, which can be used to perform various banking transactions. On signing up (details below), an account is created for you, into which you can deposit money. You can transfer money either online, from any of your bank accounts, or by depositing money at an Airtel Money or M-Pesa agent. There’s no shortage of agents. There are over 5,000 Airtel Money agents in Mumbai alone. However, unless you will be sending money to people who otherwise have no access to the banking system, you’re most likely to find this service useless.
Security of mobile payments
Both Airtel Money and M-Pesa claim that at no point is any data stored on your phone. So even if your phone is stolen, there’s no way anyone could steal from the account. To perform any transaction, you need to feed your password to the system, much like an ATM card.
Given that the service doesn’t offer much beyond net banking, you would at least expect big benefits. But M-Pesa offers no reward points at all, while Airtel Money has only a few. You can get 10% extra recharge value and 5% cashback on utility bill payments, but these aren’t any better than what your credit card already gives you.
Disadvantages of the system
Here’s what would really make you question why anyone would use this service, though. For every transaction you make, there’s a tariff (see table below). Moreover, the transaction limits are much lower than what banks allow you. For example, if you have a basic account with Airtel your transaction limit will be just Rs10,000 per month. Big purchase travel tickets like flights become unviable with this limit.
How to sign up
The service recently rolled out in Maharashtra and it looks to expand its reach in other parts of India soon. M-pesa has a tie-up with ICICI bank for its transactions. To sign up, you need to fill a form and submit it to a Vodafone store near you. A deposit of Rs200 is mandatory initially out of which Rs100 is deducted as activation fees. After this step, you can use the account for any available transactions.
|Slabs||Send money to m-pesa customers||Withdrawal||Send money to bank account|
|Re1 to Rs25||Re1||Re1||Re1|
|Rs26 to Rs50||Rs2||Rs2||Rs2|
|Rs51 to Rs100||Rs4||Rs3||Rs4|
|Rs101 to Rs250||Rs6||Rs5||Rs6|
|Rs251 to Rs500||Rs10||Rs10||Rs10|
|Rs501 to Rs1,000||Rs20||Rs18||Rs20|
|Rs1,001 to Rs2,000||Rs40||Rs30||Rs40|
|Rs2,001 to Rs3,500||Rs60||Rs50||Rs60|
|Rs3,501 to Rs5,000||Rs80||Rs75||Rs80|
Available in Bihar, Maharashtra, Jharkhand, Rajasthan, Kolkata and West Bengal
This service is running all across India and also offers you discounts on movie tickets, utility bill payments, and extra value on recharges and data packs. To sign up for Airtel Money, you can download the form or fill it up online to get an account. Once you load money into the account, you can start paying for transactions easily.
|Express account||Power account||Super account|
|Allowed transactions||Spends and transfers||Spends and transfers||Spends, transfers and withdrawals|
|Maximum cash deposit||Rs10,000 per month||Rs50,000 per day||Rs10,000 per month and Rs1,00,000 per year|
|Maximum transaction||Rs10,000 per month||Rs50,000 per day||Rs10,000 per month|
|Mode of payment||Transaction fees|
|Airtel bill payments||Free|
|Non-airtel bill payments||Rs10 to Rs500 – Rs5
Rs501 and above – Rs10
|Travel ticket bookings||1% of transaction amount|
|Movie ticket bookings||Free|
|Shops and restaurants||Free|
|Send money to Airtel Money customer or bank account||Rs0 to Rs50 – Free
Rs51 to Rs1,000 – Rs15
Rs1,001 to Rs3,000 – Rs35
Rs3,001 to Rs5,000 – Rs50
|Withdraw money||Rs0 to Rs50 – Free
Rs51 to Rs1,000 – Rs20
Rs1,001 to Rs3,000 – Rs60
Rs3,001 to Rs5,000 – Rs100
Available in All India
Vodafone M-Pesa and Airtel Money accounts don’t do away with the need for bank accounts, using which you can already perform the transactions these mobile wallets allow you to do. To add to this, there are transaction fees. Better terms and prices are expected in the future. Until then, we suggest you simply ignore them both.