New Delhi: National Payments Corp. of India (NPCI) is working to set up a framework for integrating non-bank mobile wallets with the Unified Payments Interface (UPI) platform. The process of integration will be completed in the next 2-3 months, said Dilip Asbe, the chief operating officer of NPCI.

NPCI is the umbrella organization for all retail payments in the country.

“We have started the work but there’s still a lot to be done….once the framework is in place we will start the work with wallet companies," said Asbe.

As of now, non-bank mobile wallet users cannot make payments through UPI; they can only load their wallets through it. UPI is a payments system launched by NPCI in August 2016 that facilitates instant fund transfer between two bank accounts on a mobile platform, without having any details of the beneficiary’s bank.

According to an expert, who did not wish to be named, wallet interoperability is not discussed so much in terms of transfer of money from one wallet to another wallet and is related more to wallet to merchant payment.

On 11 October, the Reserve Bank of India (RBI) had issued a directive to companies and banks to make know-your-customer (KYC)-compliant prepaid payment instruments (PPIs), such as mobile wallets, interoperable within the next six months.

“In the first phase, PPI issuers (both bank and non-bank entities) shall make all KYC-compliant PPIs issued in the form of wallets interoperable amongst themselves through UPI within six months from the date of issue of this direction," RBI said.

KYC is a process through which financial institutions verify information about customers to ensure services are not misused. “In subsequent phases, interoperability shall be enabled between wallets and bank accounts through UPI. Similarly, interoperability for PPIs issued in the form of cards shall also be enabled in due course," said the directive issued by RBI.

“If there is a UPI-based handle available for non-bank wallet users, they can easily transfer the money from their wallet to the merchant. Reading of unified Bharat quick response (QR) code on merchant location and making payments using it will not be possible for wallet users unless they are integrated with UPI," said Sunil Kulkarni, joint managing director at Oxigen Services (India) Pvt. Ltd, an e-wallet and payment solutions company.

According to Asbe, stabilizing the existing UPI platform is a major priority given the increasing transaction volumes."We are trying to build the ecosystem now and eventually UPI 2.0 will come," he said.

On Friday, he tweeted, “Next 3-6 months lot of excitement on new players coming in, existing large players rolling out to entire user base & yes BHIM UPI 2.0 !"

The new version of UPI, to be called UPI 2.0, will include new features such as electronic mandates that will allow users to pre-authorize transactions through digital signatures.

Transactions across UPI touched a new peak in November. The transaction volume was 105 million, up 37% from 76.8 million in the previous month, figures released by NPCI on Friday showed.

“BHIM UPI never sleeps! November transactions cross 105 million!," Infosys Ltd co-founder and chairman Nandan Nilekani tweeted on Friday.

Transactions through UPI received a major stimulus from the government after Prime Minister Narendra Modi launched the Bhim (Bharat Interface for Money) app on 30 December.

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