Money & Banking

Now, e-wallet users can recover cash lost to unauthorised transactions

Our Bureau Mumbai | Updated on December 05, 2018 Published on December 05, 2018

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In what could be a boost to mobile wallet transactions, the RBI has issued instructions on limiting the customer liability for unauthorised electronic payments involving Prepaid Payment Instruments (PPIs).

Customers, who carry out transactions on mobile wallets such as Paytm, PhonePe, Mobikwik, among others, will not lose their money in case of a cyber attack or negligence of the platform on which the transaction is taking place.

So far, the facility was only provided for electronic banking transactions (internet and mobile) and for credit card transactions issued by the NBFCs, where a customer would not bear any monetary loss if the unauthorised transaction is reported to the bank/NBFC.

The banking regulator, in its statement on ‘Developmental and Regulatory Policies’, said: “As a measure of consumer protection, it has been decided to bring all customers up to the same level with regard to electronic transactions made by them and extend the benefit of limiting customer liability for unauthorised electronic transactions involving Prepaid Payment Instruments (PPIs) issued by other entities not covered by the extant guidelines on the subject.”

It further added that the detailed guidelines would be issued by the end of this month. Anand Kumar Bajaj, founder of PayNearby, said: “It would be a landmark directional support from RBI in the digital payments era. The unintended/defrauded transactions of gullible customers would now be recoverable. No one can defraud or repudiate.”

A ray of hope

The direction also brings a much-needed respite to PPI operators who are reeling under regulatory issues related to e-KYC and eNACH. The suspension of these services has impacted their business and the costs of operations have gone up. E-wallets have been witnessing a massive surge in cyberattacks that compromise on customers’ accounts.

Published on December 05, 2018
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