Airtel Money

1 Introduction
Airtel money is a mobile commerce service launched by Bharti group on April 1, 2010 under the
aegis of Airtel M Commerce Services Limited )AMSL following the issuance of a Certificate of
Authorization in June, 2010 from Reserve Bank of India (RBI). AMSL is authorized to operate a
payment system and issue stored value card wallet.
Airtels foray into mobile commerce was inspired by the successful implementation of m-pesa in
Kenya. M-pesa transactions account for 31% of Kenyas GDP and make up 23% of Safaricoms annual
revenue. The service has almost 14 million subscribers which make up more than half of Safaricoms
total user base

2 The Product
Airtel Money is an account on the Airtel mobile which can opened by anyone with an active airtel
mobile number and can be used to transfer money, pay bills, recharge phone etc.
Airtel Money has three product offerings - Express Wallet, Power Wallet and Super Wallet. One
Person can hold only one wallet. The following table gives a summary of the features of each
product

Airtel Money is available through USSD (*400#), mobile app and web portal

Simple intuitive
menu; vernacularavailable in handy

Airtel money app

for all mobile OS

WEB interface on airtel.in/money

User friendly, intuitive screens; each tailored for distinct segment

3 Organization Structure
A parallel sales hierarchy is being used by Airtel to ensure additional emphasis to Airtel Money
instead of using the existing prepaid structure of Zonal Business Managers (ZBMs), Zonal Sales
Managers (ZSMs) and Territory Managers (TMs). The following chart demonstrates the sales
structure within Airtel at the circle level:

4 Current Scenario and challenges

Airtel money has witnessed promising growth in its early years:

Average ARPU of money users is 20% higher than non-money users

Airtel money users have demonstrated higher stickiness with a 50% reduction in churn vis--vis
non-money users
Adoption grew at a quarterly rate of more than 150% in the initial period
Airtel money retailers grew at a quarterly rate of 31% in the first five months

However, the airtel money growth story which seemed extremely promising in its initial phase, has hit a
few roadblocks:

Airtel money users still account for only 1% of Airtels total user base
More than 80% of Airtels prepaid retailers still dont offer Airtel money to their customers. A
primary reason for this has been the low turnaround of Airtel money balance. Historically,
prepaid retailers are used to seeing an extremely quick turnaround time for their investment.
Even retailers who are selling Airtel money are not carrying sufficient stock resulting in a loss of
interested customers.
While Airtel money has done well in migrant colonies as a way to transfer money back home,
other use cases for urban users have not been as successful. For urban users, banking products
such as electronic transfers, credit & debit cards and mobile banking applications (ICICI, HDFC
etc.) continue to be more attractive as means of transferring money/ making payments.
Mobile prepaid recharges still account for a large share of overall airtel money transactions.
Other use cases for different customer segments (banked/ unbanked, urban/ rural) have to be
relooked at.
Customers using airtel money only for airtel prepaid recharges tend to show much lower
stickiness as compared to customers using airtel money for transferring funds
Surveys have indicated that rural customers tend to find the product confusing and are much
more comfortable in performing cash transactions
The number of merchants accepting Airtel money as a payment option is still very small.
Merchants in the unorganized sector still tend to prefer cash.
Vodafone has recently launched m-pesa as a direct competitor to Airtel money after its success
in Kenya
Regulatory pressure regarding documentation has made it difficult to acquire new customers.
Even existing Airtel mobile customers are currently required to resubmit all documents proofs
of identity and address for power and super accounts.

5 Task
Given the current situation and underlying challenges faced by Airtel money, how would you ensure
sustainable growth and replicate the success of m-pesa in Kenya. The suggestions should focus on:

Product improvements
Execution efficiency
Channel strategy
Increasing customer acquisition, usage and retention