All non-banking institutions will not be allowed to load from July 1 credit line For prepaid payment instruments (PPI) such as prepaid wallets and cards. This essentially means that customers will not be able to load their Wallet/Card from their line of credit.
it could be a big blow fintech Startups like Slice, LazyPay, Jupiter, fi And university, companies like Jupiter Allows customers to load their line of credit into the wallet, however firms prefer piece and offer credit through prepaid co-branded cards issued in partnership with Fi banks.
“PPI-MD does not permit loading of PPIs from credit lines. Such practice, if followed, should be stopped immediately. Any non-compliance in this regard shall be made in the Payment and Settlement Systems Act, 2007. may attract penal action under the provisions contained therein.”
according to reserve Bank of IndiaPrepaid Payment Instruments (PPIs) are payment instruments that facilitate the transfer of money, purchase of goods and services, including financial services and remittances against the value stored within or on the instrument. As per the extant guidelines, prepaid devices are allowed to be loaded using cash, bank accounts and credit and debit cards. The guidelines do not permit the use of credit lines for topping up these devices.
The clarification could be an attempt to crack down on card-based fintechs that give users the option to pay later by providing a line of credit.
RBI’s clarification comes at a time when complaints against digital lending companies are on the rise.
Last week, RBI Governor Shaktikanta Das said that the central bank will soon come out with a comprehensive regulatory framework to deal with challenges related to digital loans.
“I think very soon we will come out with a comprehensive regulatory framework that should be able to address the challenges we face with regard to lending through digital platforms, many of which are unauthorized, unregistered, and , say, illegal,” Das said in his speech on ‘Indian Occupation (Past, Present and Future)’.
it could be a big blow fintech Startups like Slice, LazyPay, Jupiter, fi And university, companies like Jupiter Allows customers to load their line of credit into the wallet, however firms prefer piece and offer credit through prepaid co-branded cards issued in partnership with Fi banks.
“PPI-MD does not permit loading of PPIs from credit lines. Such practice, if followed, should be stopped immediately. Any non-compliance in this regard shall be made in the Payment and Settlement Systems Act, 2007. may attract penal action under the provisions contained therein.”
according to reserve Bank of IndiaPrepaid Payment Instruments (PPIs) are payment instruments that facilitate the transfer of money, purchase of goods and services, including financial services and remittances against the value stored within or on the instrument. As per the extant guidelines, prepaid devices are allowed to be loaded using cash, bank accounts and credit and debit cards. The guidelines do not permit the use of credit lines for topping up these devices.
The clarification could be an attempt to crack down on card-based fintechs that give users the option to pay later by providing a line of credit.
RBI’s clarification comes at a time when complaints against digital lending companies are on the rise.
Last week, RBI Governor Shaktikanta Das said that the central bank will soon come out with a comprehensive regulatory framework to deal with challenges related to digital loans.
“I think very soon we will come out with a comprehensive regulatory framework that should be able to address the challenges we face with regard to lending through digital platforms, many of which are unauthorized, unregistered, and , say, illegal,” Das said in his speech on ‘Indian Occupation (Past, Present and Future)’.