mobile wallets rbi

Reserve Bank of India (RBI) issued guidelines for prepaid payment instrument (PPI) licence holders in March. Mobile wallet companies expressed their concerns to RBI officials over the proposed guidelines for the sector, in their formal feedback to the regulator on them. One of the issues included the know your customer (KYC) norms.

The Payment Council of India and the Internet and Mobile Association of India (IAMAI) had arranged a meeting in which they gave out feedback on the proposed norms. Some clarifications were sought on certain clauses in the meeting, while the companies discussed issues around KYC as the norms could be an overkill for small transactions.

As per the KYC norms, companies will have to convert existing wallets without complete KYC to full KYC compliant wallets within a period of 60 days from the date of issue. If they fail to do so, no further credit will be allowed into these wallets. Currently, e-wallets and other such prepaid payment instruments can only hold up to Rs 20,000 per user with minimum KYC.


The main request given by the companies in their feedback to the RBI was that minimum KYC be retained or the deadline for implementing full KYC be extended to 18-24 months. The reason being that telecom companies would have done Aadhaar linking of mobile numbers, which will be useful to mobile wallets to do full KYC for all their clients. They also said that KYC norms will increase customer acquisition costs for them and a simple process will get complicated. The other request to RBI was to publish the interoperability guidelines for wallets.

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Other norms in which they objected include:

  • Assurance of a separate login provided for the the PPI account by mobile wallet companies, ensuring that access to PPI is not made part of access to other services offered by the issuer or its associate/parent/group company etc.
  • Requirement to have a minimum net worth of Rs 25 crore, as compared to the existing minimum of Rs 1 crore.
  • Necessary agreement requirement of wallet services with the e-commerce platforms and payment gateways rather than individual merchants. The companies will have to submit the list of merchants it hosts to the bank and timely update it.

PPIs are currently seeing monthly transactions of Rs 6,000 crore, of which about Rs 4,000 crore is from money transfers while corporate solutions such as smart cards for expense management constitute about Rs 500 crore, as per people with knowledge of the matter. Ecommerce giant Amazon recently received a wallet licence from RBI.

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