RBI removes walls between e-wallets, soon a Paytm user can transact with a MobiKwik user

RBI removes walls between e-wallets, soon a Paytm user can transact with a MobiKwik user [Inter-operability to help players increase business]

To make the use of digital cash more prevalent and convenient, a digital wallet user would soon be able to accept cash from the user of another Ewallet, because of the Reserve Bank of India (RBI) tweaking its guidelines.

Current Affairs News: For example, a Paytm wallet user would soon be able to accept cash from a PhonePe wallet user.

Opening up the strings of digital wallets, the RBI on Wednesday said it would issue revised directions by October 11 to allow “inter-operability” among prepaid payment instruments (PPIs). These include digital wallets, prepaid cash coupons and prepaid telephone top-up cards.

PPIs are a substitute for paper currency.

It is expected that PPIs can inter-operate within six months of the revised directions, the RBI said in its “Statement on Developmental and Regulatory Policies”.

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The RBI said the feedback received was examined and it was decided to rationalise the operational guidelines with a view to encouraging competition and strengthening security of operations, besides improving customer grievance redressal mechanisms.

The first guidelines for issuance and operation of PPIs came in April 2009 with the objective to create an ecosystem. In March, the RBI asked for feedback on the PPI industry. At present, two people using the same digital wallet can do transactions; in less than six months, people using digital wallets from different companies would be able to send and receive money from each other. Read More