Reserve Bank of India has continuously been on the path of finding never and better avenues to streamline the business environment of the country and as part of its latest strategy, the RBI has announced revised Prepaid Payment Instruments (PPI) guidelines on the issuance and operation of PPIs and stricter Know Your Customer (KYC) norms for users of mobile wallets. These have prompted digital payment companies to join hands and seek changes in few of the proposed guidelines. ,
An industry grouping Payment Council of India has already written to RBI seeking a hearing on issues they deem as critical to the nascent payments industry. The concern that bothers the Digital payments companies include that some of the new norms could severely cripple the industry and make the mobile wallet business un-viable.
The payment companies believe that this would destroy the relevance of mobile wallets as they think that the scope of fraud is more in moving money through debit or credit cards into wallets and then siphoning it off to other bank accounts.
Digital wallets have largely been viewed as a preferred mode of fund transfer for small value and to promote digital transactions among people who cannot easily open a bank account. And, although the digital payment companies were expecting a stringent set of guidelines, they believe that those proposed are far stricter than what they need to be.
Although the wallet industry was pushing for minimum KYC norms, the RBI guidelines while encouraging the use of digital cash, also want to keep a check on fraud through mobile wallets.