Bharti Airtel is seemingly adding a new revenue source to its existing base of customers, and that seems to be Airtel Payments Bank. The Payment Bank, which was one of the first of its kind to start operations in India, is now expecting to break even this year. This means that all the investments that Bharti Airtel has poured into Airtel Payments Bank until now will start giving back returns, thus easing financial tensions for the telecom company and allaying investor fears as well. The major reason for a swing in Payments Bank activity seems to be helped by the lockdown curbs and the returning migrants who have sought to make hassle-free payments, deposits, and increased insurance activity.
Airtel Payments Bank Logs 5.5 Crore Customers
Cross-selling of products such as insurance through the Payments Bank along with other services like direct benefit transfer, the expanded scale of operations, payment solutions, and growth in revenue are driving factors behind this new revelation of breaking even. The PTI report highlighted some more news broken through by an anonymous Airtel official who said that Bharti Airtel is “confident” of touching the break-even point this year.
On the other hand, Bharti Airtel clarified that its investment in digital infrastructure has been ample, which means that its fixed costs and incremental expenses will stay stable, allowing the revenue to surpass it. It is worth noting that the current user base of Airtel Payments Bank stands at 5.5 crores.
High Growth Rate for Revenue
The losses for the full FY21 stood at Rs 420 crore, whereas in the last quarter, the losses amounted to Rs 70 crore. On the revenue growth side, the uptick was 32%, amounting to Rs 627 crore in the latest financial year. The advantage of Airtel Payments Bank is that it has 5 lakh neighbouring banking points, and the growing lockdown situations in the country drove new accounts. The company is confident about the growing role of digital payments in the country and will be riding the wave as the numbers roll by.