The Reserve Bank of India (RBI) has extended the deadline for e-wallet companies — or issuers of prepaid payment instruments (PPIs) — to complete the ‘know your customer’ (KYC) process by another six months to August 30.
As per the earlier directions, PPI issuers were required to complete the KYC process by February 28, 2019. “Based on requests received from various stakeholders to increase the above timeline on account of difficulties in undertaking Aadhaar e-KYC and time necessary to put in place alternative systems for completing the KYC process, it has been decided to allow PPI issuers additional time of six months for completion of the KYC process,” the RBI said.
This is the fourth extension for KYC completion of e-wallet companies. In October 2017, the RBI issued a circular mandating all e-wallet entities to complete full KYC of their wallet users by December 2017. However, several prepaid payment instruments issuers expressed their inability in complying with this requirement and the RBI extended the deadline to February 28, 2018. The RBI then extended the deadline to February 28, 2019, after which customers’ e-wallets would have become non-operational.
“E-wallet companies were asking for relaxation in the KYC process as they found the RBI rules cumbersome,” said an industry source.
According to the RBI’s directive dated October 11, 2017, for prepaid Instruments up to Rs 10,000 per month, the customers can complete the minimum KYC requirements by submitting their mobile number verified with One Time Pin (OTP) and self-declaration of name and unique identification number of any of the ‘officially valid document.’ However, the customers can use these e-wallets only for purchase of goods and services. Funds transfer from such PPIs to bank accounts and also to PPIs of same/ other issuers will not be permitted. Further, within 12 months of furnishing minimum KYC details, all users need to get full KYC done.
According to the RBI’s latest guidelines, without the full KYC procedure, e-wallet users would not be allowed to send money to each other or transfer money to any bank account.