Home / Industry / Advertising /  Uber shifts to mobile wallet for payments following RBI norms

Bengaluru: Customers using Uber Technologies Inc. services for hiring cabs will have to switch to payment wallets soon, on the lines of rivals Meru Cabs and Ola that have introduced similar payment methods.

Until now, credit cards of Uber users were automatically charged at the end of the journey, a cashless payment method that had to be stopped after the Reserve Bank of India (RBI) insisted on a two-step authentication process for all card transactions.

RBI had given all such businesses till 31 October to comply with the regulation. The central bank had later granted the San Francisco-based maker of the ride-hailing application until 30 November to move to a new payment mechanism.

The Google Inc.-backed start-up has tied up with Paytm to offer the mobile wallets that users can link to their credit cards, debit cards or bank account.

“We interacted with RBI to work out a solution for our customers, and hence we came up with the Paytm wallet which our users can link to their credit cards, debit cards or bank account," said Bhavik Rathod, general manager at Uber in Bengaluru.

Uber customers will get some time to move to the wallet, said Rathod.

Rathod said the semi-closed wallet option allowed customers to use the same wallet across the merchants supported by Paytm, without having to be restricted to Uber.

Rathod said the move “will increase Uber’s customer base manifold as credit card penetration is limited in India and with the wallet option we will be able to reach a wider audience." Uber offers its services in 10 cities in India, its largest market outside of the US by number of cities.

Uber’s competitors in the Indian market largely work on a cash-based model. RBI’s move has lessened Uber’s differentiation from its Indian rival companies such as TaxiForSure, Meru Cabs and Olacabs that have in recent months also introduced mobile wallets.

Uber, which landed a $17 billion valuation in its last funding round, began its global operations in 2009 and is present in 45 countries around the world.

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