Home / Industry / Banking /  Now, you can add up to 2 lakh in Paytm, PhonePe and other wallets

To promote digital transactions in the country, the Reserve Bank of India (RBI) on Wednesday hiked the limit of outstanding balance in wallets to 2 lakh. Earlier, the limit was 1 lakh for any wallets or cards.

"To promote optimal utilisation of payment instruments (like cards, wallets etc.), and given the constraint of scarce acceptance infrastructure (like PoS devices, ATMs, QR codes, bill-payment touch points, etc.), Reserve Bank of India has been stressing on the benefits of interoperability amongst the issuing and acquiring entities alike, banks or non-banks," the central bank said in a statement.

"The Master Direction on Issuance and Operation of PPIs dated October 11, 2017 laid down a road-map for a phased implementation of interoperability amongst PPIs issued by banks and non-banks. Thereafter, the guidelines issued in October 2018 enabled interoperability, albeit on a voluntary basis, insofar as the PPIs were full-KYC (they met all Know Your Customer requirements). Despite a passage of two years, migration towards full-KYC PPIs, and therefore interoperability, is not significant," it further noted.

"As the migration towards interoperability has not been significant, it is now proposed to make interoperability mandatory for full-KYC PPIs and for all payment acceptance infrastructure. To incentivise the migration of PPIs to full-KYC, it is proposed to increase the current limit on outstanding balance in such PPIs from 1 lakh to 2 lakh," RBI governor Shaktikanta Das said during Monetary Policy announcements on Wednesday.

Commenting on the move, Ketan Doshi, managing director at PayPoint India said, "The RBI Governor's announcement on the increase of full KYC outstanding to 2 lakh, allowing cash withdrawals and interoperability, will certainly give a big boost to the wallet companies. This will enable a deep-rooted penetration of payment wallets into India's vast rural areas as well as increase the adoption of digital payments as the wallet holder, now, has the option of withdrawal — which was hitherto unavailable."

RBI also announced mandatory interoperability for full-KYC PPIs and for all acceptance infrastructure. To bring uniformity among users, the banking regulator proposed to permit cash withdrawals for full-KYC PPIs of non-bank PPI issuers. Now, users of PPIs like wallet and prepaid cards issued by non-banks would be able to withdraw cash. Now, users of PPIs like wallet and prepaid cards issued by non-banks would be able to withdraw cash. Money transfer facilities such as NEFT and RTGS have also been extended to non-bank payment system operators.

"The increase in the current limit on the outstanding balance in full KYC PPIs from 1 lakh to 2 lakh will incentivize migration to full KYC PPIs which will further bring financial inclusion across the country. We support an open and interoperable digital payments ecosystem and are looking forward to the detailed guidelines on this subject," Satish Gupta, managing director and chief executive officer of Paytm Payments Bank Ltd said.

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