The Reserve Bank of India (RBI) plans to bring open-ended prepaid cards under its purview. The central bank will issue an approach paper in this regard soon for public comments. G Gopalakrishna, executive director with the Reserve Bank of India said, ?Mobile payments and open-ended prepaid cards connect well, hence we feel they need to be regulated.?
Gopalakrishna was speaking on the sidelines of the ?Global Banking: Paradigm Shift? conference. ?There are many cards available today, which are used for various purposes. Basically, we want such cards to be regulated under the Payment and Settlement Act,? he said.
The introduction of ?mobile wallets? in the country requires that issuance of pre-paid payment instruments is first permitted to develop in a regulated environment, he noted. ?In this connection, the approach paper on pre-paid payment instruments will discuss the regulatory approach on them and would form the basis for issuance of guidelines for them as well,? Gopalakrishna added.
The central bank plans to ask respective companies to take obtain its permission before launching pre-paid payment instruments. Talking about mobile wallets, the RBI said that this would definitely help in migration of cash based transaction to electronic modes. Gopalakrishna also said that the RBI is working on developing a 24/7 electronic retail payment system in the country. ?The National Payments Corporation of India (NPCI), to be set up shortly, will facilitate the development of a robust retail payment system,? he said.