Will India's version of PayPal be relaunched?

[Ceres]

A couple of years ago the RBI put a stop to Wallet365, an internet wallet service that had been offered by The Times of India Group. The RBI was concerned that the system was unregulated.

According to a report on MediaNama, the RBI is now revisiting the subject of ewallets and other prepaid instruments. The RBI is inviting comments via their "Approach Paper."

We went through the Approach Paper, and noticed some issues:

– Not keen on Internet Banking? The RBI don’t appear to be very keen on Internet Wallets, though - to begin with, only banks will be permitted to transfer funds online or using mobile phone networks.
– Limiting Use Of Cash Cards: Semi-Closed System Payment Instruments (Cash Cards) up to Rs 500 may be to be issued without any KYC subject to reporting of annual/suspicious transactions. Which means cash cards above Rs. 500 will require KYC verification. Remember that the average transaction amount for railway tickets using cash cards in August was Rs. 889.96, and a large number of users who don’t have bank accounts will be affected.
– Limiting Reloading Of Cash Cards: Semi-Closed System Payment Instruments (Cash Cards) may only be reloaded by debit to a bank account or using credit cards. What works for Cash Cards is that people can buy them from vendors or reload them by paying cash.

You can access the Approach Paper at: RBI Guidelines - Prepaid Payments - MediaNama.com

 

[karu]

This is utterly useless. How could they even think of something like this? Doing a transaction of less than INR 500 for what? Buying some Paan or Bidi? Its completely ridiculous.

Put in all the restrictions you wish to but why not let likes of Paypal work in India? After all its gonna provide some revenue to the country.

 

[Ceres]

With regard to Internet Wallets, Wallet365 used allowed transactions over Rs 500.

Are there any limitations on the transaction amount?

Currently the transaction limits are between Rs.50-Rs.3000.

Source: Wallet365: Online Payment Service

I wonder if the RBI will impose regulations to reduce the maximum amount of Rs 3,000. It's already quite a low amount as it is.

 

[indiman]

I really pray to god to give Indian Officials some common sense. I completely agree with Karu. Ultimately they want to reduce money laundering and get revenue from transactions. So why not legalize it and take necessary action to make sure the above.