No New Licenses for e-Wallet Firms Till Feb 2017

Paying with the wallet is usual part and now a days trend is shifting from normal wallet to e-Wallet, and hence users are surrounded with lot of e-Wallet which they can use for payment of the items. But Reserve Bank of India has said that it is suspending fresh licences for prepaid instruments as it overhauls its rule book. The move comes amid mushrooming of prepaid wallets, with 47 players launching such instruments and banks complaining about regulatory arbitrage.

Current Crowded e-Wallet Market

Users are using the popular wallets like PayTM , Flipkart, Uber, Udio, MobiKwik etc and there are other players too. From early 2007 India’s central bank had started licencing a new category of players in the financial sector – issuers of prepaid instruments following the passage of the Payment and Settlement Systems Act, 2007 (PSS Act). And there are around

• 47 non-bank issuers

• 45 banks are also issuing their own prepaid wallets.

“In last couple of years, there have been significant developments in the payments space with emergence of newer technologies, products and players. These developments as well as the emerging digital environment necessitate a review of the guidelines for prepaid issuers as well,” RBI said in a statement.

Regulations by RBI

Considering above situation RBI said that to focus on the review of regulation, it will not accept any fresh application until February 28, 2017.

But during this period, business can apply for

• change in ownership/shareholding of an existing authorized entity

• Mergers and amalgamations with due court orders