Return to Normal by March, page-87

Hi Tigers,

I know you don't. Fingers crossed for an update soon.

As I highlighted from the RBI stats, we know that more money is being pulled out for each transaction and this is the reason why ATMs aren't being refilled quick enough by the banks. So it's not a question of whether people are transacting - they are, it's more the frustration around there not being enough money in the machines whenever people need it. This to me would appear a short term issue (possibly few more months away from stabilising), but medium to long term the Indian economic growth outlook is still strong and would be more beneficial to TSI as costs like cash replenishment and cash in transit would come down and hopefully things revert back to how they were or fingers crossed better.

What I took note of was the outstanding debit card stats in February 2017 (839.98m) compared to October 2016 (739.27). There were 100 million additional debit cards issued since then. Of course a decent percentage of those debit cards are inactive, so more work on this front continues from the Indian government, but have a look at the amount that was transacted through debit cards post policy changes November 2016 in the link below. Remember, debit cards are predominately used at ATMs. That was a very encouraging sign for me. Let's see how things look in the coming months.

https://www.medianama.com/2017/04/223-india-29-1m-credit-cards-840m-debit-cards-february-2017/

What I am also mindful of is the government's push for digital transactions and RBI's pending final guidelines on merchant discount rates (MDR) and the potential charges on debit card payments (refer to link below). So we'll need to keep a close eye on this pending news. Luckily for TSN, they now have the NOV tie up over the line, so that was the first big step, as it potentially opens them up to more than just their current ATM, E-Surveillance, Power Management and Bill Payment business lines, but very early days still as they only completed the agreement with NOV on the 13/04/17. I look forward to seeing what new digital areas the company intends moving in on first and the potential deals that fingers crossed materialise over the short to medium term.

http://www.hindustantimes.com/busin...debit-cards/story-BzTVhIZPUIJiWyvl2Dt4TL.html

Interestingly, e-wallet usage fell by 50% in 2017 and cash once again has started gaining ground, but do take note of what was highlighted in the last two paragraphs in the article below.

http://trak.in/tags/business/2017/03/28/debit-card-usage-demonetization-wallet-usage-falls/

Happy weekend everyone.

Tony