Ezetap, a mobile based payment startup has recently launched ‘Chota ATM’ in partnership with SBI (State Bank of India). The device which can be brought from a kirana stores is also a Point of Sale terminal for collecting electronic payments from any Debit or Credit card.
It is priced at INR 499 (as a non-refundable deposit) with a monthly fee of INR 150 – and a commission of INR 5 per cash-back transaction. Any legitimate business can open a zero balance current account with SBI and any Android or Windows phone or Tablet with a WiFi or data connection. For any Cash@POS transactions, the amount plus commission are settled the next day into the bank account of the merchant.
Here is how it works
As explained by Sanjay Swamy on his blog, the device will solve following problems:
- Shopkeepers need a safe deposit for the cash they have – and today they hoard the money and eventually take it to a bank branch for depositing it into their account.
- For the merchant, the same terminal also becomes a Point of Sale terminal to collect card-based payments – in future these could easily be extended to true mobile payments.
- Banks need to circulate the money and securely transport it to an ATM machine. This adds a lot of security and operational costs to the banking ecosystem.
- ATM machines are extremely expensive – CAPEX and OPEX – and this means fewer ATM machines.
- A trip to the ATM machine is just that – but with the Chota ATM concept there is no longer a need for that. Consumers can just go to their neighborhood shop and purchase groceries and at the time of checkout, also “purchase” some cash. Or as you exit your taxi-cab, you could pay with your debit card and also withdraw cash.
- Banks pay a commission to retailers – essentially making this an income-generating tool too!
Explaining about how safe the solution is Swamy said, “The beauty of this solution is that it is 100% certified by all the required standards and global best practices – EMV, PCI-PTS, PCI-DSS which are standards in the Payments industry. This means that the card reader and the PIN entry are exactly on par and certified as per the same standards as any other ATM.”
Related: Ezetap Gears Up To Fight In The MPOS Market, Launches An Integrated Square Like Payment Solution
Ezetap was was co-founded by Abhijit Bose, Bhaktha Keshavachar, who were later joined by Sanjay Swamy, former CEO of mChek, and Pramod Verma , former chief architect of UID project joining as the CTO of the startup.
The company successfully raised $8 Mn (INR 49 Cr) from Helion Advisors, Social+Capital and Berggruen Holdings earlier this year and later it raised additional funding from American Express.