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Business News/ Home-page / Mobile wallet transactions hit new peak in October: RBI

New Delhi: Transactions through mobile wallets hit an all-time high in October, both in terms of value and volume. Around 368.45 million transactions worth 18,786 crore took place in October, compared with 324.16 million transactions amounting to 15,102 crore in September, according to data released on Thursday by the Reserve Bank of India (RBI).

The second highest volume of transactions (340.65 million) was recorded in August.

The record transactions come at a time when most of the wallet companies are not able to on-board new customers through Aadhaar based e-KYC (electronic know your customer) norms over the last two months.

On 26 September, a five-member Constitution Bench headed by former chief justice Dipak Misra said it was “unconstitutional" for private firms to seek Aadhaar-based authentication. Section 57 of the Aadhaar Act allowed the state, companies or a person to use the unique ID to establish the identity of an individual for any purpose. After the Supreme Court verdict, only the government can use Aadhaar for social welfare schemes.

Due to lack of clarity on online mechanism to verify customers, some wallet companies moved to an offline mechanism, thereby increasing their operational costs by around 10 times. The cost of authentication went up from 15 per person, the cost of e-KYC verification, to 100-150 per person for a physical KYC.

According to Vishwas Patel, chairman of Payments Council of India, the industry body that represents all digital payments companies in India, the growth in mobile wallet transactions can be attributed to the increasing adoption of digital modes of payments.

“The increase in transactions can also be attributed to the fact that October was the peak festive season and most of the wallet companies had different offers for their customers," he said.

The PCI is also in talks with the RBI on alternative KYC mechanisms, including artificial intelligence (AI) based and video recording solutions.

Debit and credit card transactions also reached a new record, both in terms of value and volume.

The volume of card transactions rose significantly by 10% to 1424.97 million in October from 1300.42 million in September. The value of these transactions reached 4.04 trillion in October from 3.61 trillion in the previous month.

The volume of transactions through mobile banking also reached a peak in October. The transactions went up by around 10% to 526.93 million in October, from 477.57 million in the previous month. The value of transactions increased to 2.37 trillion in October from 2.07 trillion in the previous month.

Payments using real-time gross settlement (RTGS) increased by around 14.1% to 11.86 million in October from 10.4 million in the preceding month.

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Updated: 06 Dec 2018, 07:39 PM IST
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