RBI to allow money transfer between e-wallets and banks through UPI

The Reserve Bank of India (RBI) has decided to allow interoperability between e-wallets and banks through unified payment interface (UPI). This will allow customers to transfer money between e-wallet and bank accounts through UPI, in a phased manner. The central bank also tightened know-you-customer (KYC) norms for e-wallets, mandating the service providers to comply with full KYC within 12 months of opening account of a customer.


RBI says its Master Direction lays down eligibility criteria and conditions of operation for payment system operators involved in the issuance of semi-closed and open system prepaid payment instruments (PPIs) in the country. Banks are permitted to issue semi-closed and open system PPI, while non-bank entities are allowed to issue only semi-closed PPI, after necessary permission from RBI. Additionally, non-bank entities, seeking authorisation from RBI are required to have a minimum net-worth of Rs5 crore.


Navin Surya, Chairman, Payments Council of India (PCI) says, "This is third edition of reform in PPI, first one came with allowing non-banks to participate in regulated payment systems, second one came which allowed domestic remittance from PPIs to Bank Accounts. This third edition is laying foundation for PPI to become interoperable with all existing payment instruments and in par of acceptance of debit and credit cards in phases manner. This would ensure that PPIs contribution to digital payments from current share of less than 10% can move to 30-40% over the next five years."


Asking PPI issuers to comply with KYC norms for customers, RBI has directed them to maintain a log of all transactions undertaken through PPI for at least 10 years. PPI issuers will also have to file the Suspicious Transaction Reports (STRs) to Financial Intelligence Unit-India (FIU-IND).


As per the guidelines, PPIs are allowed to be loaded or reloaded by cash, by debit to a bank account, by credit and debit cards, and other PPIs. "Electronic loading or reloading of PPIs shall be through above payment instruments issued only by regulated entities in India and shall be in Indian rupees only. Cash loading to PPIs shall be limited to Rs50,000 per month subject to overall limit of the PPI. The PPIs may be issued as cards, wallets, and any such form or instrument which can be used to access the PPI and to use the amount therein. PPIs in the form of paper vouchers will no longer be issued from the date of this Master Direction except for meal paper vouchers where separate timeline has been indicated," RBI says.


As per RBI, any person can open an e-wallet through mobile number verified with one time pin (OTP) and a self-declaration of name and unique identification number of any of the officially valid documents.Officially valid document (OVD) as per RBI means passport, the driving licence, permanent account number (PAN) Card, Voter's ID Card issued by the Election Commission of India, job card issued by NREGA duly signed by an officer of the State Government, letter issued by the Unique Identification Authority of India (UIDAI) containing details of name, address and Aadhaar number. 


E-wallets with minimum KYC can be loaded or used with a limit of Rs10,000 in a month, with a overall cap of Rs1 lakh per year. These PPIs can be used only for shopping of goods or payment of services and not for fund transfer to bank accounts or other e-wallet/s. These e-wallets are mandated to become fully KYC compliant within 12 months, RBI says.


For fully KYC compliant e-wallets, the limit is Rs1 lakh per month and funds can be transferred to pre-registered beneficiaries.


Bhavik Vasa, Chief Growth Officer, ItzCash Ebix, thinks the RBI should have provided more clarity on some downward revisions like limiting minimum KYC PPI to Rs10,000. "As an industry we would like to seek clarity with the regulator and understand better on reasons for a few downward revisions and limits, like minimum KYC PPI limit of Rs10,000 and also gift cards, which are non-cash out instruments and cash loading of PPI limit. These may limit our fight against physical cash in the economy, especially when we can buy gold up to Rs2 lakh with cash in our country," he says.

  • Like this story? Get our top stories by email.



    Mahesh S Bhatt

    3 years ago

    So some control in E Currency is getting in place!!Still Consumer redressal norms to happen & protection against e Wallet Hacks??Good Mahesh Bhatt

    Flight tickets drop two weeks prior to festival: Study
    Amidst the festive madness also exist the perennial late travellers woes -- but according to a latest study by global search engine Skyscanner, flight prices from Delhi, Mumbai and Bengaluru all see a drop two weeks prior to the festival period before sharply rising one week before departure.
    With Diwali around the corner, there are still many tardy travellers who leave it to the last moment to book flights for their break and risk paying 15 per cent more than the average fare by leaving booking until the last minute.
    Analysing data from last year's Diwali travel period, Skyscanner notes that flight prices from Delhi, Mumbai and Bengaluru all see a drop two weeks prior to the festival before sharply rising one week before departure, said a statement.
    Taking cue from the searches of travel from Delhi, Mumbai and Bengaluru to different destinations, travellers can save 20 per cent, 15 per cent and 6 per cent, respectively, on flight fares. Also noteworthy is that travel from Delhi or Mumbai to other cities is actually cheaper than from Bengaluru.
    In the wake of availability of flight seats, airport taxes and length of flights, the study of Skyscanner's data further reveals that the same tickets when booked a day prior to departure can cost travellers from Delhi, Mumbai and Bengaluru upward by 12 per cent, 6 per cent and 15 per cent, respectively. Nonetheless, Bengaluru remains an expensive route for last minute travellers.
    Commenting on the findings, Reshmi Roy, Senior Growth Manager at Skyscanner said: "Diwali is a very important festival in India, one where people travel far and wide to visit friends and family. This data shows a huge number of travellers are missing out on the best prices by leaving booking until the last minute."
    "We hope travellers will use the insights that Skyscanner's data provides to find more cost-effective travel options this Diwali season. Knowing that one is still not too late to find the best fare, is definitely good news."
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.


  • User 

    Air fares likely to go up
    Airlines are looking at 10%-15% hike in airfares due to sharp increase in aviation turbine fuel (ATF) prices every month since August 2017. The most recent increase came when oil marketing companies raised prices by 6%. These hikes come at a time when the rupee is weakening against the US dollar.
    After the latest price revision, ATF will now cost Rs53,045 per kilolitre in Delhi, up Rs3,025 per kl from Rs50,020. This is the third consecutive monthly hike. While no airline came on record, they said the twin impact of costlier ATF and weaker rupee leaves them with few options but to raise fares unless they want to meet a Kingfisher - like fate.
    In addition, from 1 August 2017 the government has started levying a regional connectivity cess of Rs5,000 on each flights. Most airlines have transferred this cost to passengers.
  • User 

    We are listening!

    Solve the equation and enter in the Captcha field.

    To continue

    Sign Up or Sign In


    To continue

    Sign Up or Sign In



    online financial advisory
    Pathbreakers 1 & Pathbreakers 2 contain deep insights, unknown facts and captivating events in the life of 51 top achievers, in their own words.
    online financia advisory
    The Scam
    24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
    Moneylife Online Magazine
    Fiercely independent and pro-consumer information on personal finance
    financial magazines online
    Stockletters in 3 Flavours
    Outstanding research that beats mutual funds year after year
    financial magazines in india
    MAS: Complete Online Financial Advisory
    (Includes Moneylife Online Magazine)