The Reserve Bank of India (RBI) has refused to extend 28 February, 2018 -- the last date for fulfilling KYC (know your customer) norms for the digital wallet holders. According to a report in moneycontrol.com, with the central bank retaining the deadline, around Rs 12,000 cr business in the digital wallet space could be impacted, which is 80 percent of total business in the sector.
At present, players in digital wallet payments or prepaid payment instruments (PPIs) segment clock a monthly business of Rs 14,000 crore, the report said. As a result of being asked to adhere to the Reserve Bank of India deadline, wallet companies like Paytm, Mobikwik, Ola Money, Amazon Pay and Sodexo will have to ask their customers to give their KYC details by 28 February, the Moneycontrol report said.
The central bank, however, has clarified that customers who have balances in the digital wallets or PPIs (pre-paid payments industry) need not worry about their money even if they do not comply with the mandated KYC norms, PTI reported on Monday.
"Sufficient time has already been given to meet the prescribed guidelines. In the event PPI issuers not obtaining the KYC-related inputs within the timeline from their customers, customers will not lose their money," deputy governor BP Kanungo said, PTI reported. Kanungo said customers can continue to undertake transactions for purchase of goods and services as per the available balance, but will have to fulfill the KYC requirements before remitting money or reloading the wallet.
There are 55 non-banking PPIs operational now, apart from 50 wallets promoted by banks. They were initially given time till 31 December, 2017, to make those accounts KYC- compliant, which was extended to 28 February, according to PTI.
If the customers fail to submit their full KYC documents to complete the norms, they would face certain restrictions as far as their digital wallet accounts are concerned. A digital wallet customer can produce their valid documents which are accepted as proof of identity and proof of address along with a photograph to complete the requirement.
Some companies like Paytm offered cash as an incentive to customers to complete their KYC details.
Complete your Paytm KYC today and get up to ₹200 Cashback! T&C Apply.
— Paytm (@Paytm) February 26, 2018
Meanwhile, Ezetap, a payment solutions company, today launched EzeSmart which it claimed was the country's first open-platform, smart GPRS terminal enabled with Aadhaar pay and eKYC. EzeSmart, which runs on Ezetap’s universal payment acceptance platform can also support payment acceptance from multiple mobile wallets along with credit and debit cards, the company said, adding it a smartphone integrated terminal which enables businesses to run any of their system applications on the device.
Some players mentioned how the deadline made it difficult for them. Like Charlie Lee, CEO, Balance Hero India Pvt Ltd, a balance and data management app who said: “From the government’s perspective, it’s a well-thought-out action for securing digital transaction and AML but will take time to convert medium KYC users, who are in the majority, to full KYC users. It is a tough situation for PPI holders like us, who have more medium KYC users than full KYC users and thereby require the Government’s support to sustain both policy and business."
Updated Date: Feb 27, 2018 14:28 PM