India approves ATM to mobile money transfers

In a bid to encourage the use of mobiles for banking transactions, the Reserve Bank of India (RBI) has allowed the National Payments Corporation of India to facilitate money transfer by a bank customer from an ATM/Internet to a beneficiary's mobile phone, reports The Hindu Business Line.

The RBI's permission to expand the scope of the money transfer mechanism through the NPCI-promoted Interbank Mobile Payment Service comes at a time when mobile banking transactions are growing at a slow pace.

Transferring funds from an ATM or Internet will be simpler as only the Mobile Money Identifier number of the beneficiary will be required

According to Rupee Times, mobile banking is still in a very nascent stage in India. In order to bring a boost in this segment, which happens to be a promising one, RBI has agreed to expand the Interbank Mobile Payment Service (IMPS) initiated by NPCI.

IMPS has managed to give a significant pump up to the mobile banking scenario in India since its inception in August 2010. The number of mobile transactions has seen a rise from 430 in August 2010 to 12 511 in October 2011.

“The IMPS has so far facilitated instant inter-bank funds transfer between the sender and the receiver using the mobile. Now, following the RBI's permission, the IMPS will also facilitate funds transfer from ATM to mobile and the Internet to mobile,” says AP Hota, MD and CEO, NPCI.