RBI cancels PPI certificate of authorisation of Vodafone m-pesa
The Reserve Bank of India on Tuesday said it has cancelled the Certificate of Authorisation (CoA) of Vodafone m-pesa on account of voluntary surrender of authorisation.
Following the cancellation of the CoA, the company cannot transact the business of issuance and operation of prepaid payment instruments, the central bank said.
However, customers or merchants having a valid claim on the company as a PSO can approach the company for settlement of their claims within three years from the date of cancellation i.e. by September 30, 2022.
Vodafone m-pesa, a Payment System Operator (PSO), had voluntarily surrendered the authorisation, it said.
Last year, Vodafone Idea had decided to close m-pesa vertical following the closure of Aditya Birla Idea Payments Bank Ltd (ABIPBL), with which it was being merged.
Vodafone m-pesa was one of the 11 firms that were given payments bank licence by the RBI in 2015.
Earlier in August 2019, the Reserve Bank of India (RBI) extended the timeline for the conversion of minimum detail Prepaid Payment Instruments to KYC-compliant PPIs from 18 months to 24 months, a move welcomed by players in the segment.
The Payments Council of India (PCI) which represents the players in the payments and settlement systems has welcomed the move. The PPI industry processed more than four billion transactions in the year ending March 2019.
"It is advised that the timeline for the conversion of minimum detail PPIs to KYC compliant PPIs has been extended from 18 months to 24 months," the RBI said in a circular while making amendments to Master Direction on Issuance and Operation of PPIs.
The RBI, however, made it clear that there will be no further extension in the timeline.
Mahendra Nerurkar, Co-chair of the PPI committee at PCI and CEO, Amazon Pay, said with this extension, the industry will have a true remote digital solution for KYC for PPIs.
"PPI plays a unique role as it allows cash customers to enter the digital economy through a convenient and trusted payment experience. This instrument cannot be replaced by alternate digital payment methods which are more conducive for digital native citizens," he said.
(Disclaimer: Additional background information has been added to this PTI copy for context)
(Edited by Suman Singh)