Mobile Payment Forum of India (MPFI)

Minutes of the Seventh Meeting of the Mobile Payment Forum of India held on April 17th 2010 at IDRBT, Hyderabad
The Seventh Meeting of the Mobile Forum of India (MPFI) was held on April 17th, 2010 at IDRBT, Hyderabad with the focus of discussions on the Amendments to the Interoperability Standards for Mobile Payments and Proof of Concept and Status of Pilot test with Banks, MPFI Certification Lab and Certification Process and Business Issues of Mobile Payments, Regulatory Issues on Mobile Payments, Use of Wireless PKI for Mobile Payments, Central Switching & Real Time Settlement by NPCI, Induction of New Members in Various Committees for the Vacant Positions. The meeting was well attended by 68 members, the list of the same is attached as Annexure A. Session I Inaugural Session: 1. Welcome Address by Shri. S Ganesh Kumar, CGM, IDRBT Shri. S Ganesh Kumar, CGM, IDRBT welcomed all the delegates to IDRBT for the Seventh Meeting of MPFI. All the attendees introduced themselves. Dr. Ashok Jhunjhunwala, Chariman has mentioned the reason for conducting the Meeting after a long duration as there should be some outcomes before conducting the meetings. He has discussed with Reserve Bank of India that Mobile Payment Forum of India (MPFI) will be achieving inter-banking solution through mobile banking in the last year but it has not come out yet. He appreciated the Technical Committee for bringing out the Interoperability Standards for Mobile Payments. He mentioned that some of the choices made in the Interoperability Standards were making the transactions to be complex, which is being re-looked by the Technology Committee. In the meeting, Dr. Ashok Jhunjhunwala said that we should move further on Pilot phase which is going with the commercial answers. He has also discussed that the mobile phone is a merchant payment instrument, the transaction should take place through a bank account and no POS machine is required to make the payment, when this is done many commercial establishments would take place. He also mentioned as a point of discussion is Financial Inclusion through mobile banking. He mentioned that as the guidelines for the business correspondents has been released, Telco retailers can be used as the business correspondents. Dr. Barman, Co-Chairman said that RBI, in view of mobile payments is looking at the authentication mechanisms so that the customer should feel secure for using the application. Dr. V N Sastry, Executive Secretary presented the report on the major events, developments, financial status and various activities of MPFI conducted during 2009-10. He also highlighted the R & D activities undertaken at IDRBT in Mobile Payments area and emphasized the need for using Wireless PKI for mobile payments, use of Mobile Ad Hoc Networks in Indian villages for Financial Inclusion, Use of short code service for customer education through MPFI etc.

Mobile Payment Forum of India (MPFI)

The MPFI Developments and Trends CD was released by Dr. Ashok Jhunjhunwala, which has been compiled by Dr. V N Sastry. It covers the progressive developments of the Society of MPFI since its inception and organized into 5 chapters. The first chapter is an introduction about MPFI, its activities, committees, membership details, society by laws etc. Chapter 2 contains the various meetings of the General Body of MPFI and it covers the photos and minutes of each of the meetings held at various locations such as Hyderabad, Mumbai, New Delhi, Bangalore and Madras. Chapter 3 covers the Executive Committee Meetings so far held along with the minutes of these meetings. In chapter 4, the Standards, Regulations and Guidelines related to Mobile Payments and Financial Inclusion are included. Chapter 5 has various reports, articles and research publications on Mobile Payments, Financial Inclusion and related technologies. Dr. Ashok Jhunjhunwala has added some points about the Interoperability Standards released by MPFI, the main objective of the standards was actually payment should be done from phone to phone at a very low cost i.e. the payment should instantly move from one bank account to the other bank account of another phone. He also mentioned that when a person is trying to make a payment through his phone, the key challenge that has to be overcome is how the bank knows about where the receivers bank account is located to make the payment. He also added that for locating the bank account previously in the Interoperability standards the broadcasting protocol was used which is somewhat complicated because of the number of messages that will be increased from time to time He further added that the Technology Committee had done some minor changes to the Interoperability Standards subsequently where, there will be a centralized agency that will act for both settlement and switching. And also a change that will identify to which bank account the amount is to be credited. The Technical Committee Coordinator Ms. Rani Santhanam has presented on the changes that have been done for the Interoperability Standards. She added that the minor change was the customer should enter the beneficiarys mobile number plus amount plus Bank Identification Number (BIN) plus a Mobile Account Selector (MAS) number of beneficiary instead of entering only a mobile number which will reduce the risk factor. She also said the MAS number of every individual is public to everyone. She also added that the MAS number is a 3 digit code number that will help to identify the bank. Prof T A Gonsalves, Technology Committee member explained about the Mobile Number and the MAS number, the architecture of Interoperability which was presented contains the Central Repository. MAS Number will act as a short form for the 15 digit account number which is public. Each mobile will be backed by a three digit number called MAS (Mobile Account Selector) to be succeeded by the mobile number of the customer in order to get identified in the respective bank servers. In other words MAS (something like PIN of debit card / credit card used in ATM transaction) will be inbuilt to the system along with the mobile number.

Mobile Payment Forum of India (MPFI)

Resolution - 1 : The Technical Committee was requested to prepare a discussion paper on pros and cons of storing all the numbers in a central switch/repository and circulate which would be examined by MPFI in the next meeting. Dr. Ashok Jhunjhunwala added that the Pilot which is going on is not exactly a Pilot phase which says that it is the ultimate way to go. Though we call it as a pre-commercial launch it is more likely to call as a further commercial establishment. Ms. Rani Santhanam mentioned about the advantages of the minor changes that have been suggested and the updates of the Pilot phase, she also added that the Pilot Phase is likely to be launched in May or June 2010 and the commercial launch may be after six months. It was also decided that a pilot will be launched in the month of June in which 6 banks viz., SBI, ICICI, UBI, HDFC, BOI and YES Bank will participate. Based on their experience, P2P mobile payment system will be piloted with merchandise subsequently. One of the Member asked about the Pilot phase for which Dr. Jhunjhunwala responded that the Pilot phase is initiated with the banks that have taken lead. Technology Committee has approached the banks for implementing the same. Resolution - 2: It was decided that Technical Committee should go ahead with the pilot / pre-commercial launch with interested banks using MAS and BIN with NPCI as a switching agency. One of the Member asked whether NPCI itself would act as a switching agency, Dr. Jhunjhunwala replied by saying that NPCI or any other agency which is willing to do it can be switching agency.. One of the Member asked whether the Roadmap of the Mobile Payments also include foreign countries. Dr. Jhunjhunwala replied that as of now it is only within the country, as RBI does not permit it. One of the Member asked whether the communication between the customer and bank is voice based or message based. Dr. Jhunjhunwala answered that the communication between the customer and the bank is not part of the Interoperability Standards. One of the member asked about the MAS number. Shri G P Shekar, Technical Committee Member answered that the MAS number will be given to the customer by the bank at the time of registration. Dr. Jhunjhunwala added that MPFI would be suggesting the banks how to generate the MAS number after that it is up to the bank to provide the MAS number to the customer. One of the member asked whether the mobile payment can be done, if the beneficiary does not register for the mobile payment but has a bank account. Dr. Jhunjhunwala answered as of now according to the RBI guidelines it is not allowed.

Mobile Payment Forum of India (MPFI)

Resolution - 3: The Technical Committee will simultaneously work on the Pilot Phase, on developing the testing standards and was asked to prepare a detailed document on modified Inter-operability Standard guidelines. 2. Session on MPFI Certification Lab and Certification Process : Dr. Ashok Jhunjhunwala said that there is a MPFI Certification Lab and Certification Process and MPFI would also request TRAI to standardize the messages from the customer to the bank. Dr. Gaurav Raina, Technical Committee Member has presented on the architectures, change in approach, Application testing and MPFI certification lab at IIT Madras. Dr. Jhunjhunwala added that the application developed by the Mobile Payment Providers (MPPs) which are given to the banks could be certified by the MPFI certification lab at IIT Madras. Resolution 4: The Lab at IIT Madras will be called MPFI IITM Certification Lab. It will take up certification of the application developed by MPPs. One of the member asked about the encryption between the customer and the bank, Dr. Jhunjhunwala replied that we need to make a detailed study of the Services that are specified in the RBI guidelines. There was a discussion on the features of the mobile phone on the basis of application fitting into the mobile phone and on the enhancement of the limit of Rs. 1000/- which is mentioned in the RBI guidelines when there is no end to end encryption. Based on the above discussion, Dr. Jhunjhunwala has raised two questions: a. Can we enable an inexpensive phone to do mobile banking b. Should MPFI request to RBI regarding the enhancement of the limit from Rs. 1000/- to Rs. X-thousand. He asked the views of all the members on the above questions. Many have answered that MPFI may request RBI to make the enhancement to Rs. 3000/- or Rs. 5000/- after making a survey from Banks. Banks have been requested to send data to the chair in this regard. Dr. Jhunjhunwala asked if some of the banks can provide the data of the transaction value frequency ranging from Rs.0500,500-1000, 1000-1500 and so on. Based on the data MPFI can request RBI for enhancement of the transaction limit to Rs. 5000/- or so and the bank based on its requirement gradually make it from Rs. 1000 to 2000 and so on.

Mobile Payment Forum of India (MPFI)

Dr. Barman added that before asking RBI for the enhancement of the transaction limit RBI would definitely like to have some backup data on what percent of people are facing inconvenience for not allowing more than Rs.1000/-. It was noted that even when RBI puts the limit as Rs 5000/-, the bank again has a right to allow only a lower limit for its customers. Resolution 5 : MPFI resolved to approach RBI to allow payments upto Rs. 5000 without the use of encryption. Banks to provide necessary details to the Chairman. Resolution 6 : MPFI Certification Lab should form a group and make a study on the technology which is secure, end to end encrypted and which is not. This group may also look into how to put mobile applications on different kinds of cell phones. 3. Business Issues of Mobile payments: Shri Sourabh Jain has started the session on business issues of mobile payments Dr. Jhunjhunwala has requested the business committee to conduct the Business Committee Meetings regularly and asked to send the minutes of the same periodically. Dr. Jhunjhunwala added on the role of Unique Identification Authority of India (UIDAI) in Mobile Payments. He said the UID number will be helpful in identifying an individual. He said that MPFI should look into the details of the importance of UID for opening accounts and for the transaction the banks should look into. Shri Sanjay Swamy, Technical Committee member of MPFI had explained the details regarding UID. He is presently with UIDAI. Resolution 7 : MPFI resolved that UID when implemented would be used to open any bank account. However, the mobile transactions need not use UID authentication for every transaction and could continue to use PIN or voice -print. If the transaction value exceeds an amount like Rs 100000, then only UID should be insisted upon. Shri. N.P.Mahapatra, member brought the attention of all about the circular dated 24th December 2009 which was addressed to all the banks including State Cooperative Banks and DCCBs that in view of the circular applicability for RRBs and DCCBs the operational guidelines for banks issued in September 2008 needed to be modified in respect of clause 2.2 and 2.7 which are as under: 2.2 The services shall be restricted only to customers of banks and holders of debit / credit cards issued as per the extant Reserve Bank of India guidelines. 2.7 Only banks who have implemented core banking solutions would be permitted to provide mobile banking services.

Mobile Payment Forum of India (MPFI)

The reasons for slow progress of mobile payment implementation, even after issue of RBI guidelines, are as under : a. Customers willing to activate GPRS on their phones struggle to get it done because of the various complications in terms of the GPRS plans and settings - there are no standards for this and they vary from operator to operator. b. Business Model : A business model needs to be prepared for the mobile money transfer business in order to understand the potential of the business and the roles of various entities. The feedback from the banks, service providers, telcos as to how they will be benefited and in what proportions as the business model is not clear. c. Business model has to evolve to address the issue of sustainability. d. Challenges faced by platform providers: According to NGPay, they work independent of banks and telcos and ride on existing payment networks. According to MChek, there are some technology related challenges for implementing its business - also requires bank support to drive transactions on mCheck platform. e. Complication installing the application, the customers who are trying to down load an application in to their mobile phones are getting success upto 30 out of 100. Telecom service providers need to prepare on common setting for downloading an application. Mr. Shakeel Ahmed, Research Fellow doing Ph.D. under Dr.V.N.Sastry at IDRBT gave a presentation on the Use of Wireless PKI for Mobile Payments. Dr. V N Sastry informed that Electronic transactions based on CA PKI have legal validity as per IT-ACT-2000 and the increasing computational capabilities of mobile phones makes it feasible for adoption of Wireless PKI in India to enhance Security. The discussion paper available in the MPFI proceedings circulated may be looked by members for consideration and early adoption. 4. Financial Inclusion: Dr. Ashok Jhunjunwala said that the Telcos retailers play an important role for Financial Inclusion. One of the member said that banks and telcos should work together and suggested that the solution would be by both telcos and banks and they should jointly put a proposal to RBI that Telcos would be doing certain activities and Banks would be doing certain activities. One of the members had an opinion that, for total Financial Inclusion, the BC model will be more effective when mobile to mobile payment becomes a reality. The issue of interoperability and settlement issues needs to be addressed in order to make the venture success. Resolution 8: It was decided to have a committee consisting of Dr. Ashok Jhunjhunwala and Telcos Vodafone, Airtel, Reliance and Tata Teleservices for discussing about the criteria of selecting the Telco Retailers for Financial Inclusion. Banks and Telcos should work together and solve this issue.

Mobile Payment Forum of India (MPFI)

Induction of new members in Various Committees for the vacant positions: 5. Executive Committee: Shri. Jambunathan of SBI will be replaced by Shri Kajal Ghose of SBI. Shri Pallab Mitra of Airtel will be replaced by Shri Sriram of Airtel. Shri G.Padmanabhan, RBI would be an invitee. Dr. A P Hota, NPCI would be an invitee. Sri. Kajal Ghose, SBI would be the Treasurer of MPFI. 6. Technical Committee: Shri. Jambunathan of SBI will be replaced by Ms. Rani Santhanam of ICICI Bank as the Co-ordinator Shri Kajal Ghose of SBI will be the Technical Committee Member Shri. Sanjay Swamy of mChek will be replaced by Shri Suresh of mChek Dr. Mahil Carr will be replaced by Dr. V N Sastry Representatives from Axis bank & NPCI to be included. 7. Regulatory Committee: Shri C.Naushad will be the co-coordinator 8. Business Committee Shri Nayak will be replaced. 9. Communications and Events Committee: Shri Pallab Mitra of Airtel will be replaced by Shri Sriram of Airtel Resolution 9: It was suggested that each of the committees should meet at least four times a year (may be by phone). Dr. Ashok Jhunjhunwala said that the next meeting of MPFI would be held in August or September 2010 and SBI will host the same. Shri. Kajal Ghose to take care for the same. He also added that Interoperability means any phone using any application linked to a bank account of any operator of any bank should be able to transfer or receive money from any phone using any application linked to a bank account of any operator of any bank. Shri Sourabh Jain, Business Committee Member added a few points on sending the data over GPRS, it would be complex because the user has to understand the settings before using it and the customers are also ignoring it. For this Dr. Jhunjhunwala responded that the Telcos, Banks and Technology providers should sit together to solve this issue.

Mobile Payment Forum of India (MPFI)

Resolution - 10: It has been decided that when the technology provider provides an application to the bank, if the customer comes to the bank for registration whose phone does not have GPRS connection, it is recommended that for that particular customer, the Telcos should open the GPRS for particular period of time so that the application will be loaded on to the customers mobile and this can be done by charging some amount to the customer. Dr.Ashok Jhunjhunwala requested Director, IDRBT to continue to provide the Secretariat support of MPFI for one more year and if IDRBT does not accept to do so, IIT Madras would be doing the same. Dr. Ashok Jhunjhunwala thanked IDRBT for hosting the 7th MPFI Meeting successfully and requested all to speed up mobile payment implementation.

(Dr.Ashok Jhunjhunwala) Chairman-MPFI May 2, 2010

(Dr.V.N.Sastry) Executive Secretary-MPFI

Mobile Payment Forum of India (MPFI)

Annexure A List of Participants

S. No. 1. 2. 3. 4. 5. 6. 7. 8. 9. Name of the Official Dr.Ashok Jhunjhunwala, Chairman Dr.R.B.Barman, Cochairman Shri. S Ganesh Kumar Dr. V N Sastry, Executive Secretary Dr. T A Gonsalves Prof. U B Desai, Mr. Sanjay Swamy Mr. Kajal Ghose Mr. Sourabh Jain Name of the Organization IIT, Madras RBI IDRBT IDRBT Indian Institute of Technology, Mandi IIT, Hyderabad Unique Identification Authority of India (UIDAI) State Bank of India Jigrahak Mobility Solutions Pvt. Ltd. (ngpay) Comviva Reliance Communications Ltd. Cellular Operators Association of India (COAI) Federal Bank Ltd. Kotak Mahindra Bank ICICI Bank ICICI Bank NABARD Unitus Unitus NPCI NPCI Samsung India Operations(SISO), R&D Software Mobile

E-Mail IDs
ashok@tenet.res.in barmanrb@gmail.com sganeshkumar@idrbt.ac.in vnsastry@idrbt.ac.in tag@tenet.res.in ; head@cse.iitm.ac.in director@iith.ac.in sanjay.swamy.uid@gmail.com kajal.ghose@sbi.co.in sourabh.jain@ngpay.com sandeep.srivastava@comviva.com Ritesh.b.shah@relianceada.com kkapoor@coai.in

10. Mr. Sandeep Srivastava 11. Mr. Ritesh Shah 12. Mr. Kshem Kapoor

13. Mr. Abraham A. Samuel 14. Mr. Abhishek Sharma 15. Mr. Rahul Joshi 16. Ms. Rani Santhanam 17. Mr. Mohapatra N P 18. Mr. Vikas Jhunjhunwala; 19. Mr. Jeevan Kumar 20. Smt Sapna Sharma 21. Mr. Dillip Asbe 22. Dr. C.Narendiran

abrahama@federalbank.co.in Abhishek.s.sharma@kotak.com rahul.joshi@icicibank.com rani.santhanam@icicibank.com npmohaptra100@yahoo.com np.mohapatra@nabard.org vjhunjhunwala@unitus.com jkumar@unitus.com sapna.sharma@npci.org.in dilipasbe@npci.org.in c.narendiran@samsung.com

Mobile Payment Forum of India (MPFI)

23. Mr. Suresh Anantpurkar 24. Mr. Janardhanan Reddy 25. Mr. Sameer Shah 26. Mr. Puneet Srivastava 27. Mr. Gaurav Chopra 28. Mr. Kalyan Biswas 29. Mr Aspy Engineer

mChek Gemalto Spanco Spanco IAMAI IAMAI Axis Bank

suresh@mchek.com Janardhan.reddy@gemalto.com sameer@spancotele.com puneet.srivastava@spancotele.com gaurav@iamai.in kalyan@iamai.in aspy.engineer@axisbank.com

30. Mr. Nitin Chittal 31. Mr. S.K.Mohapatra 32. Mr. Kamaljit Rastogi 33. Mr. Gopal Krishna 34. Mr. Sandeep Sreedharan 35. Mr. Chandrashekar Rao Kuthyar 36. Mr. Prashant Dhananka 37. Mr. Sriraman Jagannathan 38. Mr. Pawan Bakhshi 39. Mr. P K Sengupta 40. Mr. Manoj Kumar Panicker 41. Mr. Niranjan Gosavi 42. Mr. Dewang Neralla 43. Mr. Uttam Nayak 44. Mr. Nitin Bhatnagar 45. Mr. B Roychoudhury 46. Dr. Gaurav Raina 47. Mr. Abhinav Sinha

Axis Bank Union Bank of INDIA Financial Information Network & Operations Ltd Ericsson Nihilent Infosys Infosys Bharati Airtel

nitin.chittal@axisbank.com smohapatra@unionbankofindia.com kamaljit.rastogi@fino.co.in Gopal.krishna@ericsson.com s.sreedharan@nihilent.com chandrashekar_raok@infosys.com Prashant_dhananka@infosys.com sriram@airtel.in

Bharati Airtel Opus Soft Estel Technologies

Pawan.bakhshi@airtel.in sengupta@opussoft.com

manoj.kumar@esteltelecom.com Atom technologies Atom technologies Visa International Sisa International SBI IIT-Madras niranjan.gosavi@atomtech.in dewang.neralla@atomtech.in unayak@visa.com nitin.bhatnagar@sisa.co.in br.choudhury@sbi.co.in gaurav@lantana.tenet.res.in

Eko India Financial Services Pvt Ltd

abhinav@eko.co.in

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Mobile Payment Forum of India (MPFI)

48. Mr. Abhishek Sinha 49. Mr. G P Shekar 50. Mr. Vickey Rodrigues 51. Mr. Naushad 52. Mr. Wable R U 53. Mr. Raghunandan S G 54. Mr. Lalit Sinha 55. Mr. Sivakumar K 56. Mr. Deep Singh 57. Mr. Sayeed Alam 58. Mr. Vivek 59. Ms. Neha Gupta 60. Shri Anthony A E 61. S Kumar 62. K Avanthi 63. A Kavitha 64. Shaikh Shakeel Ahmed 65. Rohit Kumar 66. Abdul Farquad 67. K Srinivas 68. Mohan Koteshwar Rao

Eko India Financial Services Pvt Ltd FSS Vodafone India Vodafone India Samsung HDFC Union Bank of India Integra Micro Comviva CanvasM CanvasM Bharti airtel Kotak Mahindra Bank Corporation Bank IDRBT IDRBT IDRBT IDRBT IDRBT IDRBT IDRBT

abhishek@eko.co.in shekargp@fss.co.in vickey@rodrigues@vodafone.com naushad.contractor@vodafone.com wable@samsung.com Raghunandan.Godbole@hdfcbank.com lalitsinha@unionbankofindia.com siva@integramicro.com deep.singh@comviva.com sayeed.alam@canvasm.com vivek.chandok@canvasm.com neha.gupta@airtel.in anthony.esthakku@kotak.com skumar@corpbank.co.in kavanthi@idrbt.ac.in akavitha@idrbt.ac.in ssahamad@idrbt.ac.in DRKumar@mtech.idrbt.ac.in mdahfarquad@idrbt.ac.in ksrinivas@idrbt.ac.in mkrao@idrbt.ac.in

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