Launched in 2004, Oxigen has created a closed-wallet platform where consumers can pay cash for services at small shops, kirana stores and customer service centres in rural areas and big stores in urban areas. This money is then credited to the retailer’s wallet and can be used to make payments. Oxigen has 2 lakh retail access points at which 600 million transactions were done last year; this year, the figure will rise to 750 million. Oxigen’s PoS, a smartphone that relies on GPRS for internet connectivity and includes a biometric scanner that connects its back-end to the Aadhaar database, is now a banking and retail access point to buy insurance policies as well. Its wallet also supports prepaid Visa cards: on e-commerce sites that don’t accept wallets, customers can use the Oxygen prepaid Visa cards instead. The card can be topped up, reused or discarded and customers can generate as many as they wish.
Oxigen also runs a pilot project with the Grameen Foundation in UP to collect loan repayments and another with an insurance company to collect premiums at its outlets. On the anvil are services for customers to purchase goods from e-commerce sites and pay for them at Oxigen’s retail outlets. These merchants share a distribution margin with Oxigen on every transaction but the customer doesn’t pay anything extra. For remittances, customers aren’t charged for storing money in their wallets. But for money transfers, customers are charged 1.5%, which is lower than if they were to go to a bank. In the past financial year, the company reported annual transactions worth Rs.10,000 crore; chairman and founder Pramod Saxena expects this to increase toRs.15,000 crore in the current fiscal. The company has been profitable for the past four years. Recently, it split into two entities — one for retail payments and the other for mobile and internet-based wallet services. “While our retail payments business is profitable, we believe that despite the initial heavy investment needed, our smartphone-driven consumer wallet business will break even in two to three years,” says Saxena.