Bharti Airtel runs a wholly-owned banking subsidiary company in India called Airtel Payments Bank. The company has paid good returns to Airtel as it is now profitable. Rarely do we see banking or finance startups in India becoming profitable as fast as Airtel Payments Bank.
Airtel Africa, majorly owned by Bharti Airtel recently launched SmartCash Payment Service Bank. It is a wholly-owned banking subsidiary of Airtel Africa.
The SmartCash Payment Service Bank can issue debit and prepaid cards to consumers, and facilitate payments and other banking services within Nigeria. The newly launched banking subsidiary has received its license from the Central Bank of Nigeria and is headquartered in Lagos.
What Will SmartCash Payment Service Bank Owned by Airtel Africa Do?
Segun Ogunsanya, CEO, Airtel Africa said this new bank will offer consumers both banking as well as mobile financial services which will result in last-mile connection to the people who are financially excluded. According to the data shared by the Financial Services in Nigeria, 36.8% of the adult population is unbanked. This marks an opportunity for Airtel Africa to swoop in and make an impact with its financial services.
Airtel Africa can definitely take learnings from the business model of Airtel Payments Bank which has led the company to become profitable in a very short span.
There are plenty of things that SmartCash Payment Service Bank will need to do if it wants to create an impact. First of all, the company will need to communicate how it is a more convenient option than the traditional banks. Second, the company will have to tell the consumers about how secure the mobile experience would be. Third, in Nigeria, offline retail presence would play a major role in expanding the brand and business fast. Airtel Africa can definitely make the SmartCash Payment Service a profitable entity just like the Airtel Payments Bank if the company can execute things in the right manner.