Axis Bank has concluded a deal with Kochi Metro Railway under which the bank will invest Rs 100 crore for the Automatic Fare Collection system of Kochi Metro. All the investments will be made in phase 1 of the project. The bank will pay Rs 209 crore as royalty to Kochi Metro under the project. Axis Bank will issue co-branded debit cards to the users of Kochi metro system. The cards can be used for both for transit and shopping. Kochi Metro will collectl 20% from the revenue from the use of the debit card in mercantile outlets and internet transactions outside the Kochi Metro ecosystem. Moreover, the bank will undertake the maintenance for the AFC system for 10 years. The normal practice in metros worldwide is for the metro company to invest their own funds for the capital expenditure required for AFC. However, Kochi Metro invited competitive bids from various Indian banks to invest the entire capital expenditure on the AFC system, in return for their right to use co-branded cards and co-branded software on the metro system, which will function both as a debit card of the Bank as well as a ticket for entry into the metro system.
