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RBI says interoperability available only for full KYC wallets

All forms of wallet interoperability will happen through Unified Payments Interface and cards through the interoperable card networks.

, ET Bureau|
Oct 17, 2018, 08.37 AM IST
BENGALURU: Mobile wallet companies eagerly waiting for the Reserve Bank’s final guidelines on wallet interoperability saw their Dussehra celebrations start early in terms of interoperability between wallets, bank accounts and ability to issue interoperable prepaid cards as well.

In a circular released on Tuesday, the central bank issued consolidated guidelines for enabling all phases to prepare wallets better for interoperability.

RBI clarified that all forms of wallet interoperability will happen through Unified Payments Interface and cards through the interoperable card networks. In order to ensure security of all such transactions, RBI has mandated PPI issuers to adhere to all security guidelines laid out by the National Payments Corporation of India for UPI and card networks for merchant onboarding. However, interoperability will only be made available for full KYC wallets.

“This will enable players to start issuing payment instruments from card networks (RuPay/Visa/MC) which will be accepted across both physical merchant locations through PoS Teeminal or through Bharat QR code and there is no need for us to onboard merchants separately.

RBI graph

“Also through BHIM UPI, there will be free two-way flow of funds between wallet and bank accounts,” said Sunil Kulkarni, joint managing director of Oxigen Services.”

Kiran Vasireddy, chief operating officer at Paytm, responded to the new guidelines saying that it will make the overall PPI ecosystem stronger. Wallet companies will now be issuing their own handles and will be onboarding customers in their own rolls and not on behalf of banks, as earlier.

RBI further mandated that all cards issued under this route will have to be EMV chip and pin from the beginning since the regulator is trying to phase out magnetic stripe cards. RBI had first spoken about allowing mobile wallet interoperability in October last year and had promised the feature within six months. While there was a delay from the central bank in issuing guidelines, wallet founders, grappling with multiple regulatory and technical challenges, can now heave a sigh of relief.

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