Put mobile payment services on hold-RBI

RBI asks banks to put mobile payment services on hold

In a significant decision, the Reserve Bank of India (RBI) has restrained banks in launching their mobile payment services for the time being. In a notification on Tuesday RBI said that all the banks, which have already started their mobile payment services, will have to suspend them till the issuance of final guidelines.
The RBI found that there are a number of attendant issues and therefore, has asked banks to keep on hold their mobile payment services till issuance of the final guidelines.Banks have been told that they may also dissociate themselves from any mobile based money transfer service which has not received explicit approval of RBI or not covered by any of the guidelines issued by the central bank, the central bank said.
The central bank observed that a few banks have already started offering mobile payment services to their customers without waiting for the release of RBI’s guidelines.
Recently, few banks like Standard Chartered, ICICI and Barclays have been seen offering mobile payment services.”While the RBI has no objection for use of mobile channel to provide basic services such as mobile alerts for credit or debit entry, balance enquiry etc, which are in the nature of providing information, due care needs to be taken for permitting the channel for customers to initiate payment instructions,” the RBI said in its statement issued on mobile payments in India - operating guidelines for banks, on Tuesday.
Speaking on this matter, an ICICI Bank spokesperson said, “As far as our mobile banking facility is concerned, the withdrawal of cash happens only through the branch banking and so, we adhere to all RBI regulations. Our mobile banking facilitates the money transfers across bank accounts.”
Meanwhile, the RBI is in the process of finalising the operative guidelines for banks on mobile payments. The draft guidelines were placed on the RBI website and a number of comments have been received.
The comments are being compiled and after evaluation of the comments, the final guidelines would be issued, the RBI said.