State Bank of India (SBI), the
country’s largest lender, plans to set up 600,000 points of sale
(PoS) terminals as part of its plans to foray into the merchant
acquiring business. Around 40 percent of the terminals are to be
set up in metros and major urban centres, while the rest will be in
so called Tier-II and Tier-III centres.
“In smaller cities, there is a large cash
economy… and there is a growing realisation to reduce dependence
on cash. So, we can exploit that opportunity,” said the bank.
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It adds that its decision was driven by the
rise of retail businesses across the country, an increased use of
plastic cards and technology, and the Indian government’s drive
towards electronic commerce.
The move comes at a time when SBI is investing
significant sums on its distribution and payment networks in a bid
to maintain its position as India’s leading financial services
player.
At the end of August, the bank entered into an
agreement with local technology firm 3i Infotech to provide kiosk
banking facilities to rural customers. It also announced a major
ATM expansion drive with manufacturer Diebold to deploy 1,700 new
ATMs across the country.
This comes on the back of similar deals with
other companies earlier in the year adding 2,000 ATMs to its
network.
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