| State Bank of India (SBI) has selected US-based | | | | - Bank plans to enable very low-value transactions |
| Elavon Incorporation and Visa International for a joint | | | | through pre-paid cards. |
| venture to facilitate payment through debit or credit | | | | - The increased acceptance of its debit cards as SBI |
| card at the retail outlets through swipe machines (or | | | | has issued close to 7 crore debit cards to its account |
| merchant acquiring business) on a pan-India scale, with | | | | holders. But these cards are largely used for |
| metro, urban, semi-urban and rural centers. Elavon US | | | | withdrawing cash from automated teller machines. |
| is a wholly-owned subsidiary of US Bancorp and a | | | | Instead of withdrawing cash only account holders |
| leading global payments provider. US Bancorp is the | | | | would also be able to make payments through cards, |
| holding company of US Bank, the fifth-largest bank in | | | | thus the bank will generate huge savings in cash |
| the US. | | | | handling and maintaining cash balances. |
| The terms of arrangement are still being worked out | | | | Last year, ICICI had sold its POS terminal network to |
| but RBI has already given its approval for the setting | | | | First Data Corporation for $80 million (around Rs 365 |
| up of a wholly owned subsidiary by SBI in the name of | | | | crore). While SBI's ambitions are bigger, |
| SBI Payment Services. | | | | ICICI Bankhas been an early mover and had already |
| SBI had floated Request For Proposal (RFP) for | | | | had an installed base of 1.5 lakh machines at the time |
| selection of joint venture (JV) partner for merchant | | | | of the sale. |
| acquiring business in 2009. Then the bank had reduced | | | | By next financial year SBI plans to place about one |
| the list of candidates to three candidates — Visa, | | | | and half lakh POS terminals for debit and credit card |
| Royal Bank of Scotland (RBS) and Global Payments. | | | | payments across India and six lakh POS terminals in |
| After putting in place a core-banking solution, SBI has | | | | the first five years of its operations. |
| been in a hurry to acquire leadership position in | | | | The State Bank Group currently has over 18,000 |
| electronic networks as well. | | | | ATMs across India and has issued over 60 million debit |
| The business would include acquiring bank identification | | | | cards. |
| numbers (BINs) from the schemes, as well as | | | | POS terminals have become big business due to two |
| managing services for point of sale (PoS) terminals | | | | recent developments: |
| among others. | | | | 1. RBI has said it will allow small cash withdrawals |
| The managed services would include installation of | | | | through such POS terminals. |
| POS terminals at customer locations, their replacement, | | | | 2. RBI has said it would encourage banking |
| merchant training and maintenance, etc. | | | | correspondents to increase financial inclusions. |
| Advantages: | | | | |