Digital payments have been on a massive rise in India since about a year now. One of the biggest beneficiaries of this digital drive are smartphone wallets. While wallets allowed quick and easy digital payments, there was one restriction - you can’t transfer from one brand of wallet to another unlike banks. However a new Guideline will soon allow you to do this.
As per this new RBI Guideline, prepaid payment instruments such as e-wallets, gift cards and meal coupons will become inter-operable for customers complying with KYC Guidelines. The Reserve Bank has given the banks a period of six months starting the 11th of October to implement this feature.
So far, it wasn’t possible to transfer money from wallet owned by one brand to wallet owned by another brand. While it was possible to quickly transfer within the same brand of wallets, inter-operability wasn’t supported. This new RBI Guideline ensures that it will be coming soon. As part of the P2P lending guidelines, the Reserve Bank of India capped borrowing and lending on a peer-to-peer platform by an individual at Rs 50,000.
This decision has been welcomed by E-commerce firms. Kiran Vasireddy, Chief Operating Officer of Paytm, said, “We welcome the decision of RBI to bring interoperability amongst KYC-complaint wallets”. “RBI’s latest direction in this regard will provide a homogenous environment for the growth of mobile wallets,” said Bipin Preet Singh, Mobikwik founder and CEO.
So far banks were the only financial systems which had this sort of a power. While this can be seen as end of control for wallets, it’s going to prompt a price war and will ultimately benefit the consumers as more discounts might be introduced to attract customers towards using their wallets. Stay tuned with us for more updates on this RBI Guideline and it’s implications in the market.