Mobile wallets will become strong players in the financial ecosystem as the RBI guidelines on prepaid instruments will allow more features like unlimited transfer of funds between a bank account and a wallet, a top official of Paytm Payments Bank said. Paytm Payments Bank MD-CEO Renu Satti said the RBI guidelines released this month will enable mobile wallets to gain access to more functionalities like unlimited transfer of funds between a bank account and a wallet and higher limit of up to Rs 1 lakh for money transfer to beneficiary accounts.
She added that as part of Paytm Payments Bank, customers get the convenience of wallets and can earn interest on their deposits by transferring money from the wallet to their payments bank account. “This will further strengthen the value proposition of mobile wallets and make them stronger players in the financial ecosystem,” Satti said. Paytm has over 270 million registered wallet users. However, the mandate to undertake KYC of customers could be a challenge as mobile wallets companies will have to make additional investments in the diligence process.
The KYC process allows banks and other institutions to obtain and verify information about customers’ identity and address. As per the new norms, mobile wallets that were conforming to a minimum KYC format (like verification of mobile number) will have to get full KYC of customers done within 12 months of setting up the wallet.