On Tuesday, players like Amazon Pay and Mobikwik said the extension of deadline for Know Your Customer (KYC) norms will ensure that customers are not impacted adversely. They said the move would have a positive impact on India’s financial inclusion story.
What came as a major relief to e-wallet companies, the Reserve Bank of India on Monday had extended deadline by six months for compliance with Know Your Customer (KYC) norms, for prepaid payment instrument (PPI) issuers. The earlier deadline was February 28.
Upasana Taku, co-founder and director at MobiKwik, said the extension will give it more time to complete the full KYC process for its users.
Upsana Taku told PTI as reported in Business Today that mobile wallets have been instrumental in driving digital payments in India. This announcement will ensure increased adoption and growth for digital payments. This would have a positive impact on the financial inclusion story.
The extension will also offer players more time to chart out strategy for compliance, Payments Council of India (PCI) chairman said Vishwas Patel.
He added that if the extension had not come through, our members could have lost 80-90 per cent of their user base. Physical KYC is not only a time consuming effort but also an expensive process. Operators would now get more time to strategise on the road map.
PPIs are instruments that facilitate purchase of goods and services, including financial services and remittance facilities, against the value stored on such instruments. E-wallet companies were caught in a fix over looming deadline as companies were apprehensive that they will not be able to meet the central bank’s deadline to complete KYC of all customers by February-end.
The largest player in the ecosystem, Paytm has not yet responded to queries.
Hemant Gala, head of Payments, Banking and Financial Services at PhonePe, said that post the Aadhaar judgement, the entire PPI industry was anxiously awaiting clarity on how to do KYC moving forward. This six-month extension will help things to settle down.
Amazon, which operates Amazon Pay, said the extension in KYC timeline would help ensuring customers are not impacted adversely.
