Send, Receive Money From Paytm, Google Pay, PhonePe From This Date: Interoperability Begins

A recent circular issued by the Reserve Bank of India (RBI) mandated that all licensed prepaid payment instruments (PPIs) or mobile wallets including PhonePe, Paytm, Google Pay and Mobikwik, be interoperable from FY23.

How Does This Help?

With this move, a mobile wallet user, who is fully vetted and has fulfilled all KYC norms, will be able to send and receive money from various mobile wallets from the beginning of April 2022.

This can be established for card-based PPIs through card network interoperability and for e-wallets via the UPI (Unified Payments Interface), according to the central bank.

Further the circular mentioned that PPI for Mass Transit Systems (PPI-MTS) will remain exempted from interoperability.

On the other hand, GIFT PPI issuers will have the option to offer interoperability.

Cash Withdrawal By Using Mobile Wallets

In addition to this, the circular also stated that mobile wallets can also be used for cash withdrawals up to Rs 2,000.

Further adding that the wallet limit has also been expanded to Rs 2 lakh from Rs 1 lakh.

Customer Redressal Mechanisms

The central bank said that “Any PPI issuer offering this facility shall put in place proper customer redressal mechanisms. Complaints in this regard shall fall under the ambit of the respective ombudsman schemes and instructions on limiting the liability of customers,” in its circular.

The circular mentioned that “PPI issuers shall put in place suitable cooling periods for cash withdrawal upon opening the PPIs or loading/ re-loading of funds into PPIs to mitigate the risk of fraudulent use of PPIs,”.

All these measures were announced by RBI Governor Shaktikanta Das after the April 5-7 MPC (Monetary Policy Committee) meeting.

Increased Outstanding Balance

In his post-policy statement, Das had stated, “To incentivize the migration of PPIs to full-KYC, it is proposed to increase the current limit on the outstanding balance in such PPIs from Rs 1 lakh to Rs 2 lakh,”.

Initially, in October 2018, the RBI had issued guidelines for the adoption of interoperability on a voluntary basis for full-KYC PPIs.

Although, there was no significant shift towards it.

Currently, cash withdrawal is permitted only for full-KYC PPIs issued by banks, such as debit and credit cards. 

With these new rules, now a prepaid card or payment wallet can be used to withdraw cash at ATMs, micro-ATMs, and eligible PoS (Point of Sale) depots.