Amazon Pay to be India’s first interoperable Wallet

          Reserve Bank of India vide Notification No RBI/2018-19/61 DPSS.CO.PD.No.808/02.14.006/2018-19 dt. October 16, 2018 issued guidelines regarding ‘Interoperability Prepaid Payment Instruments (PPIs)’.

         

Q) What is Interoperability?

Ans: Interoperability is the technical compatibility that enables a payment system to be used in conjunction with other payment systems.

          Interoperability allows PPI Issuers, System Providers and System Participants in different systems to undertake, clear and settle payment transactions across systems without participating in multiple systems.

          Amazon Pay has kick-started the process to be offer interoperability to its wallet holders by tying up with Axis Bank.

          @apl  will be Amazon Pay’s UPI handle. The testing for interoperable launch is in progress with a CUG. Based on the feedback from the CUG users, Amazon Pay will fine-tune the compelte process.

          The date for the public launch is not in public domain.  However, the public launch will be in the near future

7 Benefits to Amazon Pay on this new business opportunity

Benefit 01) The first mover advantage

Benefit 02) Enable Amazon Pay to quickly onboard new merchants with UPI as the key differentiator

Benefit 03) Enable Amazon Pay to acquire a high number of customers through attractive cashback offers

Benefit 04) Enable Amazon Pay to save considerable costs associated with API integration on multiple eCommerce Sites. Amazon Pay wallet users can seamlessly transact with all the UPI handle users without any additional cost.

Benefit 05) More visibility for Amazon Brand across online as well as offline channel.

Benefit 06) Increase in the average balances held by wallet holders in Amazon Pay PPIs

Benefit 07) Increase the pressure on peers to quickly adopt wallet interoperability.

         

Q: What are the requirements for PPIs to achieve interoperability through UPI?

Ans: Requirements for achieving interoperability through UPI

1 PPI issuers shall facilitate all basic / standard features of interoperability of UPI.

2 PPI issuers shall act as Payment System Providers (PSP) in the UPI. NPCI will issue handle to the PPI issuers as per its policy / guidelines taking risk management aspects into consideration. Since *99# USSD is part of UPI, non-bank PPI issuers are also allowed to participate in the same.

3 PPI holders shall be on-boarded for UPI by their own PPI issuer only. PPI issuers shall only link their customer wallets to the handle issued to them.

4.PPI issuers as PSP shall not on-board customers of any bank or any other PPI issuer.

5 Authentication will be completed by the PPI holder as per his / her existing wallet credentials. In other words, a transaction will be pre-approved before it reaches the UPI.

6.  Settlement: For the purposes of settlement, a non-bank PPI issuer shall participate through a sponsor bank. Non-bank PPI issuers shall adhere to the requirements of sponsor bank arrangement in UPI as also meet all requirements of NPCI in this regard.

Additional Reading

RBI Guidelines For The Interoperability Of Prepaid Payment Instruments: A Boost For Digital Wallets?

Now Transfer Money From One E-Wallet To Another As RBI Kickstarts Interoperability