Treasury Practice

Problem Solved: Anil Agrawal, IDEA Cellular Limited

Published: Nov 2010

IDEA Cellular is a provider of GSM mobile services in India with a large number of distributors across the country for the prepaid business. Prepaid subscribers constitute over 80% of the company’s revenues. The company’s key challenge was to reduce its cash to sales cycle, leveraging an efficient and technologically-enabled solution.

Anil Agrawal

GM, Finance & Accounts

IDEA Cellular is a publicly listed company, having been listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) in March 2007. IDEA Cellular is a leading GSM mobile services operator in India with around 73m subscribers, under the brand IDEA. It is a pan-India integrated GSM operator covering the entire telephony landscape of the country, and has National Long Distance License (NLD) and International Long Distance License (ILD) operations.

IDEA Cellular’s parent company is Aditya Birla Group, India’s first truly multinational corporation. The group operates in 25 countries, and is anchored by over 130,000 employees belonging to 30 nationalities.


The company’s key challenge was to reduce its cash to sales cycle, leveraging an efficient and technologically-enabled solution.

Anil Agrawal, GM, Finance & Accounts, IDEA Cellular Limited, explains: “We have 22 telecom circles across the country, which are serviced by a large number of distributors for our prepaid business. When we first rolled out the pre-paid business under the distributor model, our main mode of payments collection was via cheques. The disadvantage of this mode of collection was higher credit risk and cost of collection. We were keen to implement an electronic mode of collection that would lower credit risk, improve our cash to sales cycle and lower the cost of collections.”

To achieve this objective, IDEA Cellular turned to Deutsche Bank for a solution that would enable its distributors to pay electronically. In addition, the client was also looking for other cash management services such as Enterprise Resource Planning (ERP) integration and auto account reconciliation services.


IDEA Cellular was initially considering solutions like Real Time Gross Settlement (RTGS) and National Electronic Fund Transfer System (NEFT). These solutions have the ability to improve the efficiency of the entire collections process significantly. However, one of the major downsides of the solutions is the lack of payer identification data, which is crucial for accounts receivables reconciliation. This is further amplified by India’s geographical size and the large number of drawee banks in the country. Compounding the situation further was IDEA Cellular’s requirement for a customised solution on an immediate basis, given the urgent need to improve efficiencies by migrating collections to an electronic mode.

“The key differentiator for Deutsche Bank was its unique Payer ID solution, which enables us to streamline our accounts receivables reconciliation with complete ease and effectively,” says Agrawal. “The solution allows IDEA Cellular to identify the payment party in a fully automated manner even though such information is not provided by the remitting bank. Using the concept of a unique virtual account number provided to each party for making payments to IDEA, Deutsche Bank is able to identify the payer and provide the information to IDEA via a secure channel for automated reconciliation.”

Agrawal further adds, “Deutsche Bank’s solution met our requirements fully. This, coupled with its proven track-record of implementing technologically-enabled solutions in a quick turnaround time, with minimal interruption to our ERP system, was a key factor for us to award the mandate to Deutsche Bank. We are impressed with the professionalism shown by the team, which includes a strong service team for our daily requirements.”

Agrawal continues, “Since the successful implementation of Payer ID, we have seen tangible benefits in terms of faster sales to collection, a more efficient process flow and improved credit risk control. This solution gives us a great opportunity to scale up without incurring additional overhead costs.”

“I am extremely satisfied and glad that we appointed Deutsche Bank for this solution. They have shown a lot of commitment in delivery and meeting our requirements comprehensively.”

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