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E- wallets out of unified payments system

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E- wallet players have been kept out of the new Unified Payments Interface ( UPI) at the behest of banks. Banks felt including e- wallet services, which is set to make money transfer simpler, might not be in the interest of banks, said an official who is a part of the team working on UPI.
The Payments Council of India, which represents these wallet players, had communicated to the National Payments Corporation of India ( NPCI) that they would like to be part of the UPI system.
However, they have not been included so far.
These non- bank players have an edge in the mobile wallet space as first movers. They established themselves before the banks entered the space. These players had cashed in on the rise of smart phones and offered safe and simpler transactions to consumers.
Even though banks are late entrants to this space, they would be able to establish soon thanks to their customer base. Experts say the dynamics of the digital money transfer will change with banks getting avantage point in UPI.
This is because unlike a wallet, UPI is inter- operable across all the banks.
Wallet players believe with banks having the UPI advantage, the market will get tougher. Therefore, they have been looking at diversifying the business.
“We are still hopeful that we may be allowed to be a part of the UPI as we can also play acrucial role in reducing cash transactions. However, in the short- term, some players might face some problem and might have to look at adding another business line to see how they can reduce the impact,” said Naveen Surya, managing director, ItzCash.
Business Standard New Delhi,19th May 2016

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