Oct 17: Money transfer between digital payment applications such as Paytm, Mobikwik, PhonePe, and the like is likely to be rolled out soon. Operational guidelines issued by the Reserve Bank of India (RBI) encourage prepaid payment instruments (PPI) such as mobile wallets, meal and gift cards interoperate, said a news report.
RBI, in its guidelines, has stated that, in order to achieve interoperability, the financial companies which make use of the PPIs should have a board-approved policy and should be compliant with Know-Your-Customer (KYC) guidelines.
A report quoting Bipin Preet Singh, Co-Founder of Mobikwik, termed this as a great move , adding that this will take the e-payment sites to an equal place as that of the banks. This, in turn, will help earn the confidence of the customers to use such platforms for transactions. Stating that there are no limitations in using the wallets, he was heard saying that wallet payments can be made by the users at a place which offers card payment facilities. Wallet money can be used for online shopping platforms like Amazon and Flipkart. He added that with the new notification there will not be any restrictions on the payment system.
As per the notifications, all the PPI users who want to be part of the move should be directed by the technical specifications/ standards/requirements for achieving interoperability through UPI and card networks. This is based on the requirements of National Payments Corporation of India (NPCI) and the relevant card networks.
Requirements which are common for wallets and cards to achieve interoperability are that, the interoperability across PPIs shall be enabled through UPI if the PPIs are issued in the form of wallets; when the PPI is issued in the form of cards, the cards will be allied to the certified card networks. All KYC-compliant PPI accounts are also applicable for the interoperability. In October 2017, the apex Bank had assured interoperability to mobile wallets.
According to the RBI, card networks can allow PPI issuers to join their networks while non-bank PPI issuers can join as members/associate members of authorized card networks.
Interoperability can also be made available to those PPI issuers who work wholly in Meal, Gift and MTS segments. As of now, the interoperability is expected to bring a drastic change in the digital payments industry.