India launches mobile payments app for the masses
On the heels of India’s move last month to discourage cash-hoarding by demonetizing certain bills, Prime Minister Narenda Modi on Dec. 30 announced the rollout of a government-managed mobile payments app.
The app, called Bharat Interface for Money (BHIM) works on Android devices and relies on fingerprint authentication, enabling bank-to-bank transfers, including person-to-person payments and purchases from participating merchants by scanning a QR code. Transactions are limited 10,000 rupees per day.
The new app could create challenges for existing mobile apps in India, including Paytm and MobiKwik, because of its simple, direct connections to banks, according to some reports.
National Payments Corp. of India developed the app on the government’s behalf under the auspices of the Reserve Bank of India.
BHIM was unveiled on the last day of the 50-day window Indian citizens had to exchange or deposit older currency notes of 500 or 1000 rupees, as part of India’s push to reduce the country’s heavy reliance on cash.
Users must register their bank accounts with BHIM and set up a four-digit PIN with mobile number as payment address to send and receive funds. To promote the app, India’s government is sponsoring a drawing for users in 100 cities to win prizes.