Uber India rants against the RBI compliance, but is it overlooking its own mistakes?

Uber has blamed the Reserve Bank of India (RBI) for a slow conversion of customers from credit cards to a wallet system, which was incorporated after the RBI made the two-step authentication process mandatory for all transactions taking place in India. While the rule tries to make online transactions more secure, it conflicts with websites that use a payment gateway which is located overseas, which may not implement the same authentication process. The RBI mandate also prohibits what it calls ‘foreign exchange outflow’ and insists that transactions within India must be done through a bank within the country and in Indian rupees. Uber, being a US-based company, has therefore had to revise its payment process, which now involves users to pay via a third-party wallet, called Paytm. Unlike the previous model, which needed travelers to enter their credit card details just once and when charges would automatically get deducted at the end of their rides, the new system needs users to recharge their Paytm wallets before the journey. Paytm’s payment gateway includes the two-factor authentication (2FA), which complies with RBI’s guidelines. While this requirement is intended to provide more security for consumers, Uber claims that “it is an antiquated solution that is cumbersome for consumers and stifling for businesses across India.” It has also blamed the RBI for not being able to generate much revenue after the change. The company goes on to slam the 2FA requirement, saying “Ahead of the Reserve Bank of India’s (“RBI”) compliance deadline we have seen a slow conversion of riders from credit cards to a 2FA compliant wallet, which indicates their trust in Uber’s payment system and a preference for more convenient yet secure online/mobile payments. Despite consumer preference and in the face of rapidly changing business expectations, India’s one-of-a-kind 2FA requirement persists, causing a major challenge for businesses trying to offer Indian consumers a better purchasing experience.” However, Uber customers have a different story to tell. Uber India’s Facebook page has users voicing against Uber and Paytm’s poor customer service,which has ultimately made the new payment process a pain in the neck. While Uber blames the RBI’s mandate, some Uber customers have found that the system isn’t implemented properly.  One customer says “I have added prepaid wallet 3-4days back, I have not been able to book a ride. My balance does not show up in the Uber account. And no one to respond to mails and no call centre also..” Another person says “<span data-ft=”{" tn":“k”}"="" data-reactid=".2g.1:3:1:$comment487824688022407_487984814673061:0.0.$right.0.$left.0.0.1:$comment-body">Paytm wallet is not working in my Android Tab.. I couldnt link it with my card today morning when I needed your service the most !" Another user said, ““Adoption” has not been “slow” by consumers. It has been next to impossible. I have been trying to link the payment wallet to Uber for two days running but keep facing technical difficulties. Uber has failed in managing the transition, and is now lashing out at the central bank, the government and even their own presumably stupid “slow” consumers.” Some have complained that Paytm’s services are not up to mark. One Uber customer said, “<span data-ft=”{" tn":“k”}"="" data-reactid=".2g.1:3:1:$comment487824688022407_488207904650752:0.0.$right.0.$left.0.0.1:$comment-body">I deposited 4000 in my paytm account on Sunday. But I’m unable to use it. Unable to login. Unable to get any reply from paytm on email / phone / social media. Can’t we have some other option apart from paytm?" While it’s easy to be a cop-out and blame Indian regulations, Uber should have worked on making wallet payments an easier process. The 2FA is not a new regulation and was, in fact, present even before Uber came to India. The company then chose not to adhere to these regulations and evaded the authentication and business/ payment model. Also, Uber isn’t the only one using a wallet system. Olacabs, which is a rapidly-growing radio-cab service, uses an in-app wallet which allows users to recharge their wallets. Similarly, Meru cabs partnered with Citrus Pay for cashless travel. Using online wallets, customers can load money in them via a debit card, credit card or net banking and the money gets debited automatically after every ride.