November 5, 2019 1:00:27 am
The Reserve Bank of India on Monday announced the opening of the first cohort (end-to-end process) under the Regulatory Sandbox (RS) with retail payments as its theme.
The products and services which, among others, will be considered for inclusion under RS include mobile payments including feature phone based payment services, offline payment solutions and contactless payments, the RBI said.
The adoption of ‘retail payments’ as the theme is expected to spur innovation in digital payments space and help in offering payment services to the unserved and underserved segment of the population, the RBI said on Monday.
A Regulatory Sandbox usually refers to live testing of new products or services in a controlled or test regulatory environment for which regulators may or may not permit certain relaxations for the limited purpose of the testing.
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“Migration to digital modes of making a payment can obviate some of the costs associated with a cash economy and can give customers a friction-free experience,” it said.
“There is a need to innovate payment services for feature phones to provide the necessary thrust towards enhanced adoption of digital payments by various strata of society,” the RBI said in a statement.
Though mobile internet speed has risen, connectivity issues remain unresolved in large areas, it said. “Therefore, providing an option of off-line payments through mobile devices for furthering the adoption of digital payments is required,” it said.
Contactless payments, while decreasing the time taken for payment checkout, also ease payments for small ticket payment transactions. Tokenisation technologies often form the basis of facilitating seamless e-commerce experiences fuelled by mobile and other connected devices, the RBI said.
The RBI said the live testing of new products or services in a controlled environment may require a bank or NBFC or any other partner for the testing to commence. In such cases, a suitable partner may be secured in advance to be eligible for admission to the RS, it said.
The window for submission of application for the first cohort shall be open from November 15 to December 15, 2019, it said.
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