95% of mobile wallets may stop functioning by March. All you need to know

95% of mobile wallets may stop functioning by March. All you need to know

New Delhi: Users of mobile wallets in India are expected to encounter problems soon as most of these mobile wallets may become dysfunctional by March, believe payments industry executives, as they are of the opinion that companies will be unable to meet the Reserve Bank of India’s (RBI’s) February end deadline to complete know-your-customer (KYC) verification, says an Economic Times report.

In October 2017, the apex bank had issued guidelines asking prepaid payment instruments (PPIs) or mobile wallets to gather all information required under the KYC norms. Companies to date have been able to validate just a part of their total user base, and are yet to complete biometric or physical authentication of the majority of customers, the report mentioned citing industry executives.

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“More than 95 per cent of the mobile wallets in the country could stop being operational by March,” a senior executive with a New Delhi-based payments company told ET. He went on to add that there is no eKYC and the banking regulator has no given any clear-cut guidelines about the alternative KYC procedures that they plan to approve. “The deadline is just a few weeks away and we cannot adhere to (it) with this rate of progress,” the executive from the payment company told the publication.

The report further highlighted that there have been talks about alternative KYC method such as using video-based authentication or XML-based KYC, but none of these procedures has been formally okayed by the central bank.

The financial daily quoted another payment executive as saying, “We are waiting till January 8, that is the last day of the winter session of Parliament; let us see what happens to the Aadhaar Bill. We will reach out to RBI and ask for the next course of action.”

A senior executive told the financial daily several digital wallet companies which were used for remittance have moved to the business correspondent channels thanks to regulatory restrictions. “Only standalone wallets will be directly affected by the (current impasse),” he mentioned.

Worth mentioning here is that private entities have been unable to carry out Aadhaar-based e-KYC after the Supreme Court’s verdict to restrict private firms from accessing the Aadhaar details of consumers.

 

Source:- timesnownews

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