RBI may soon introduce mobile wallet interoperability rules
Banks and the PPI industry have been waiting for the RBI to issue operational guidelines on interoperability for several months now
New Delhi: The Reserve Bank of India (RBI) is expected to issue operational guidelines on interoperability this week.
According to one person familiar with the development, the central bank is likely to mandate wallet companies and banks to complete the certification and integration process for enabling interoperability with the National Payments Corporation of India (NPCI) by the end of October.
Banks and ‘know your customer (KYC)’-compliant prepaid payment instruments (PPIs) will have to complete the integration and certification process with NPCI for interoperability to be rolled out. This will take another three to four months, and the guidelines issued by the RBI will entail the procedure,” said the person, requesting anonymity.
Banks and the PPI industry have been waiting for the RBI to issue the guidelines for several months now. Last October, it had issued a directive to banks and PPIs on interoperability, which was to be enabled in a phased manner. It had also said that operational guidelines on interoperability would be issued separately.
“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 among themselves through the Unified Payments Interface (UPI) within six months from the date of issue of this direction,” the RBI had said.
UPI is a payments system launched by the National Payments Corp. of India (NPCI) in August 2016. It facilitates instant fund transfer between two bank accounts on the mobile platform, without having to provide any detail of the beneficiary’s bank account. 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 in October 2017.
Over the last few months, the PPI industries have been facing a difficult time trying to comply with the revised KYC norms starting 1 March.
Interoperability will increase the use cases for customers and will also get them to do their KYC with us as full-KYC PPIs will only be able to avail the benefits of interoperability, said a senior executive of a payments company, which has a prepaid payment instrument licence from the RBI. The executive did not wish to be named.
Data from the RBI show mobile wallet transactions, by volume and by value, were substantially lower in March than in February, as companies struggled to come up with the necessary compliance infrastructure and convince users to provide the required documentation.
While the value of mobile wallet transactions fell from a peak of Rs13,100 crore in February to Rs10,000 crore in March, and Rs11,695 crore in April, volumes were down to 268.79 million in March from 310 million in February. It was 279.29 million in April.
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Business NewsIndustryRBI may soon introduce mobile wallet interoperability rules
First Published:25 Jun 2018, 01:50 PM IST
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