Skip to main content

RBI’s KYC Norms Burn a Hole in Mobile Wallet

By
RBI’s KYC Norms Burn a Hole in Mobile Wallet
No of transactions via mobile wallets fell 13% to 269 m in March from 310 m in February
India’s mobile wallet industry saw a sharp fall in usage in March as new Reserve Bank of India regulations kicked in, although not as drastically as had been feared. The number of transactions through mobile wallets fell 13% to 268.79 million in March from 310.01 million in February, and the value of money settled through wallets dropped 23% to ?10,000 crore from ?13,100 crore, RBI data show.
With the country showing higher adoption of digital payments overall, the fall in transactions through mobile wallets is likely because of customers moving out of the wallet ecosystem after RBI made full Know-Your-Customer requirements mandatory from March.While the industry had expected an 80-90% fall in wallet usage after February 28, when the new rules became effective, the numbers do not show such a drastic fall.
“The only possible explanation could be that transactions have picked up in terms of usage of wallets for goods and services, because remittance payments through wallets have definitely fallen as per our systems,” said the chief executive of a mobile wallet company, speaking on condition of anonymity.In an earlier interaction with ET, Mobikwik CEO Bipin Preet Singh had said that nearly 40% of their total users had submitted some form of identification documents.
An Amazon spokesperson had said cash being loaded into Amazon wallets had fallen by 95%, which could affect the rapid digitization of payments through wallets in rural and semi-urban locations.The fall in the value of transactions, however, is higher, showing that mobile wallets remain a predominant mode of transaction for small-value bill payments and recharges.
Transactions via prepaid cards, which are predominantly used for gift cards, too, have dropped since that industry has also been affected by RBI’s revised guidelines. In March, the total number of transactions fell to 24.8 million from 35.3 million in February.Meanwhile, the use of debit cards for merchant payments and of IMPS (Immediate Payment Service) for instant bank-to-bank settlements has increased. Debit card swipes at point of sales jumped to 318 million in March from 282 million in February. IMPS transactions jumped 10% to 110.15 million.Transactions via the Unified Payments Interface (UPI) jumped to 190 million in March from 178 million in February.

A senior payments industry executive said customers may have stuck to a minimum level of activity on their mobile wallets, as allowed by RBI for those having clearing its minimum KYC requirements. The main challenge now, this person said, would be to convert these customers into full KYC customers within one year, as mandated by RBI.

The Economic Times, New Delhi, 14th May 2018

Comments

Post a Comment

Popular posts from this blog

New income tax slab and rates for new tax regime FY 2023-24 (AY 2024-25) announced in Budget 2023

By
  Basic exemption limit has been hiked to Rs.3 lakh from Rs 2.5 currently under the new income tax regime in Budget 2023. Further, the income tax slabs in the new tax regime has been changed. According to the announcement, 5 income tax slabs will be there in FY 2023-24, from 6 income tax slabs currently. A rebate under Section 87A has been enhanced under the new tax regime; from the current income level of Rs.5 lakh to Rs.7 lakh. Thus, individuals opting for the new income tax regime and having an income up to Rs.7 lakh will not pay any taxes   The income tax slabs under the new income tax regime will now be as follows: Rs 0 to Rs 3 lakh - 0% tax rate Rs 3 lakh to 6 lakh - 5% Rs 6 lakh to 9 lakh - 10% Rs 9 lakh to Rs 12 lakh - 15% Rs 12 lakh to Rs 15 lakh - 20% Above Rs 15 lakh - 30%   The revised Income tax slabs under new tax regime for FY 2023-24 (AY 2024-25)   Income tax slabs under new tax regime Income tax rates under new tax regime O to Rs 3 lakh 0 Rs 3 lakh to Rs 6 lakh 5% Rs 6
Post a Comment
Read more

Jaitley plans to cut MSME tax rate to 25%

By
Income tax for companies with annual turnover up to ?50 crore has been reduced to 25% from 30% in order to make Micro, Small and Medium Enterprises (MSME) companies more viable and also to encourage firms to migrate to a company format. This move will benefit 96% or 6.67 lakh of the 6.94 lakh companies filing returns of lower taxation and make MSME sector more competitive as compared with large companies. However, bigger firms have shown their disappointment since the proposal for reducing tax rates was to make Indian firms competitive globally and it is the large firms that are competing globally. The Finance Minister foregone revenue estimate of Rs 7,200 crore per annum for this for this measure. Besides, the Finance Minister refrained from removing or reducing Minimum Alternate Tax (MAT), a popular demand from India Inc., but provided a higher period of 15 years for carry forward of future credit claims, instead of the existing 10-year period. “It is not practical to rem
1 comment
Read more

Don't forget to verify your income tax return in August: Here's the process

By
  An ITR return needs to be verified within 120 days of filing of tax return. Now that you have filed your income tax return, remember to verify it because your return filing process is not complete unless you do so. The CBDT has reduced the time limit of ITR verification to 30 days (from 120 days) from the date of return submission. The new rule is applicable for the returns filed online on or after 1st August 2022. E-verification is the most convenient and instant method for verifying your ITR. However, if you prefer not to e-verify, you have the option to verify it by sending a physical copy of the ITR-V. Taxpayers who filed returns by July 31, 2023 but forget to verify their tax returns, will get the following email from the tax department, as per ClearTax. If your ITR is not verified within 30 days of e-filing, it will be considered invalid, and may be liable to pay a Late Fee. Aadhaar OTP | EVC through bank account | EVC through Demat account | Sending duly signed ITR-V through s
Post a Comment
Read more