The Race Is On
After a roller coaster ride over the past two years, non bank digital wallets in India have come of age. Much of the credit goes to the Reserve Bank of India, which issued in October its final guidelines on interoperability among prepaid payment instruments (PPIs) mobile wallets or m wallets (mostly non bank ones), prepaid cards and vouchers for meals and gifts.
Put simply, this long awaited move allows linking of all KYC compliant m wallets for transactions and, eventually, all wallets and bank accounts via Unified Payments Interface or UPI. Even prepaid cards issued by PPIs will be linked to authorised card networks. The new guidelines will come into effect in a phased manner, but the road map ensures a level playing field for all PPI players, still struggling to make good in a fast evolving digital economy.
The Big Bang
Long before demonetisation, a couple of regulatory milestones helped the PPI ecosystem grow and thrive. The first came in 2009 when the RBI allowed non bank entities to participate in the formal financial system. Then again, in 2013, Immediate Payment Service or IMPS (part of the PPI ecosystem) was allowed to send money to bank accounts.
