Payments Technology Cos Barred from Road E-tolling
NPCI invites only banks to offer service; Paytm, Mobikwik & Citrus Pay lose out on big opportunity
Saloni Shukla & Pratik Bhakta
Mumbai: The National Payments Corporation of India (NPCI) has shut its doors on payment technology companies in one of the most lucrative business areas — toll collection on roads — as it invites only banks to provide the payments service. Paytm, Mobikwik and Citrus Pay, which have been planning to tap this business, may have to find alternate routes.
“They (wallets) might be interested, but NHAI has not shown interest and we have not suggested to NHAI to bring in non-banks,” AP Hota, MD & CEO of NPCI, told ET.
National Highways Authority of India (NHAI) has tied up with NPCI to set up an interbank clearing house to enable e-tolling across all toll plazas in the country. The move is expected to help the country save thousands of crores of rupees annually in fuel consumption and speed up freight. The measure will help reduce congestion at toll gates and curb malpractices. Total automation of toll collection across the country is expected to reduce average waiting time at toll plazas by 10 minutes. Hota added the ball was now in NHAI’s court, as the project was the highway authority’s brain child. “Even after bringing all banks under the fore if NHAI finds that it is not scaling up they might allow non-bank players to come. But as of now, there is no thinking on allowing non-banks,” said Hota. Mobile payments and ecommerce platform Paytm, which recently received the ISO 27001 certification, has been eyeing government cont- racts, including e-tolling. “Honestly, I am not worried, I am sure they will come around,” Nitin Misra, Head of products at Paytm, said. “There are cases where the government has been progressive in the past; the RBI gave us the payment bank licence.” While NHAI has not considered use of digital wallets for recharging of ETC tags, Mumbaibased payments company Citrus Pay intends to become the payment gateway for the inter-bank clearing house that NPCI will set up for the e-tolling across national highways. The firm has already started accepting toll payments online for all the entry points into Mumbai. “Even if NPCI wants to have only banks on board now, I am sure it will not be very difficult to influence this policy. Once they see that our users far outnumber the users of banks’ payments instruments they will turn around to get us on board as well,” said Upasana Taku, cofounder of mobile wallet company Mobikwik.
The implementation of a pan-India electronic toll collection system on national highways may help save .₹ 87,000 crore, according to a joint study by the Transport Corporation of India and the Indian Institute of Management Calcutta.
The study said the length of time at toll points adds up to a cost of .₹ 27,000 crore a year.
A pan-India electronic toll collection system on national highways may help save 87k crore