Now money will talk on mobile phones, courtsey Bharti Airtel

Bharti Airtel customers will soon be able to pay their bills at retail outlets and restaurants using their cell phones.

The largest telco in the country by both customers as well as revenues has received the Reserve Bank of India's (RBI) nod to collect a maximum of Rs5,000 from customers for conversion to virtual money stored on mobile phones. This can then be used at outlets that have a tie-up with Airtel.

Leading mobile phone companies are to get this 'semi-closed wallet' licence in a couple of months.

With over India 650 million mobile users in the country, telecom companies are planning to offer a range of financial services, including the electronic version of the leather wallet for making secure payments across a wide spectrum of goods and services. Such modes of payment have already been adopted in Japan, South Korea, parts of China and certain markets in Europe.

Earlier in the year, in its annual monetary policy RBI said it was looking to use mobile phones as a medium for extending banking facilities to remote areas. It urged banks and cellular operators to cooperate rather than compete with each other in the initiative.

''Semi-closed wallet are prepaid payment instruments that are redeemable at a group of clearly-identified merchant locations/ establishments which contract specifically with the issuer to accept the payment instrument. These instruments do not permit cash withdrawal or redemption by the holder,'' Bharti Airtel said in a statement.