eWallets hold breath as RBI looks into KYC deadline

rbi image
eWallets hold breath as RBI looks into KYC deadline


BENGALURU: The Reserve Bank of India is ‘looking into’ several requests that it has received from mobile wallet companies for an extension of the deadline for the implementation of know your customer (KYC) norms for their users beyond December 31.

“Some PPI (prepaid payment instruments) issuers are in the process of meeting the deadline. Requests had been received from few PPI issuers regarding the extension of time. We are seized of the matter and are looking into it,” said the central bank responding to an ET query.

As per the revised guidelines for PPIs released on October 11, the RBI had instructed all mobile wallets to complete minimum KYC of all their users within the end of this year, failing which it would impose severe restrictions on the usage of those wallets. While most of all the payment companies have started urging their users to link their wallets with their Aadhaar numbers, many entities had requested the central bank for an extension of the timeline.

Mobile wallet users till now had to authenticate the mobile number through an OTP (one time password) and could immediately start using it for transactions. But the RBI in a revised master circular said that companies would also have to collect “selfdeclaration of name and unique identification number of any of the officially valid documents”. While most of the wallet companies have started urging their users to link their wallet account with their Aadhaar numbers, it’s a Herculean task which could not have been completed within three months, they say.

“There have been multiple discussions between stakeholders in the payments industry and the regulator and we have presented to them the operational difficulties faced by us, we think that the RBI would give us more time to implement the KYC norms,” said one of the top executives of a payment company on condition of anonymity.

Though there have been no assurances or clarity on the timeline received, the fact that the central bank is considering the requests have given hopes to the companies that the deadline could be pushed by a minimum of three months.

While the largest payments instrument of the country Paytm has become a payments bank and is reported to have built a base of around 50 million KYC users, other wallet entities are said to be lagging behind. Also, to get the Aadhaar verification done for consumers is proving to be more difficult than initially expected. As per data released by the central bank, in 2016-17, mobile wallets have reported around 1.6 billion transactions worth ?53,200 crore which shows the scale of operations for this industry.

“We are pushing our wallet partners to go full throttle on the KYC of its users so that the smooth functioning of the app is not hampered, but usually in such cases we have seen that the regulator pushes the deadline to allow the industry to implement the changes properly,” said a senior banker with a private sector lender.


Source by:- indiatimes