Page 34 - Banking Finance October 017

ARTICLE

ment instruments issued by a person for facilitating the point of time does not exceed Rs.20,000/- and the to-
purchase of goods and services from him. These instru- tal value of reloads during any given month also does
ments do not permit cash withdrawal or redemption. not exceed Rs.20,000/-. These can be issued only in
As these instruments do not facilitate payments and electronic form.
settlement for third party services, issue and operation ii. From Rs.20,001/- to Rs.50,000/- by accepting any offi-
of such instruments are not classified as payment sys- cially valid document defined under Rule 2(d) of the PML
tems, e.g., Make My Trip Wallet.
Rules 2005, as amended from time to time. Such PPIs
2. Semi-Closed System Payment Instruments: These are can be issued only in electronic form and would be non-
payment instruments which can be used for purchase reloadable in nature.
of goods and services, including financial services at a iii. Up to Rs.1,00,000/- with full KYC and can be reloadable
group of clearly identified merchant locations / estab- in nature. The balance in the PPI should not exceed
lishments, which have a specific contract with the is- Rs.1,00,000/- at any point of time.
suer to accept the payment instruments. These instru-
ments also do not permit cash withdrawal or redemp-
tion by the holder, e.g., State Bank Buddy, Mobikwik Popular e-Wallets in India
etc. 1. State Bank Buddy - State Bank Buddy offered by State
Bank of India is the first Indian mobile wallet which is
3. Open System Payment Instruments: These are pay-
available in 13 Indian languages. Using this, sending
ment instruments which can be used for purchase of money, asking reminders to clear dues, instant bill pay-
goods and services, including financial services like funds ments and more can be effected from the mobile. Sate
transfer, at any card accepting merchant locations Bank Buddy mobile wallet helps one to do the above
(point of sale terminals) and also permit cash with- activities by linking debit cards or internet banking to
drawal at ATMs / BCs. E.g. SBI MobiCash, Airtel Money
it. It allows loading amount into wallet and making
etc.
payments to contacts on phone book.
Eligibility to issue Prepaid Payment In- 2. PayTM - PayTM is one of the most popular digital wal-
lets. It allows one to add his Credit / Debit cards and
struments (PPI) link bank account to it. One can make use of QR code
1. Banks who comply with the eligibility criteria would be to send and receive payments easily. PayTM mobile
permitted to issue all categories of pre-paid payment wallet allows buying movie tickets, online mobile re-
instruments. charge, payment of electricity bills and more using the
mobile. PayTM is also an e-commerce website, just like
2. However, only those banks which have been permitted
to provide Mobile Banking Transactions by the Reserve Amazon, Flipkart etc. where lakhs of products are be-
Bank of India shall be permitted to launch mobile based
pre-paid payment instruments (mobile wallets & mo-
bile accounts).
3. Non-Banking Financial Companies (NBFCs) and other
persons would be permitted to issue only closed and
semi-closed system payment instruments, including
mobile phone based pre-paid payment instruments.

The following types of semi closed Pre-paid Pay-
ment Instruments (PPIs)can be issued, subject
to carrying out of Customer Due Diligence, as
detailed :-
i. Up to Rs.20,000/- by accepting minimum details of the
customer, provided the amount outstanding at any

BANKING FINANCE | OCTOBER | 2017 | 33

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