How to Withdraw Money from Wallets at ATMs And Pay at A Merchant?


According to the latest financial policy, the Reserve Bank of India (RBI) has allowed merchant payment and cash withdrawal from prepaid instruments (PPIs) such as mobile wallets. The RBI has also permitted them to become part of its centralized payment system – RTGS (real-time gross settlement) and NEFT (national electronic funds transfer).

This new development demands wallets to sync with bank accounts. But how this is supposed to happen as the former doesn’t have an account number and wallet companies do not own ATMs either? So how a customer will withdraw money from the wallet at ATMs or pay at a merchant?


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Well, the wallet companies did find a solution for this and came up with a satisfactory solution, that is, wallet companies will issue a prepaid card to their customers and with the help of this prepaid card, the customers can easily withdraw money from ATMs and can also swipe cards at merchant stores. This is what Praveen Dhabhai, director and chief operating officer, Payworld Money, had to say on this.

RBI issued guidelines on the interoperability of wallets back in October 2018. Wallets got the allowance to offer money transfers via UPI (Unified Payments Interface) and issue cards on RuPay and Visa networks.

It has been three years since the guidelines were carried out by the Reserve Bank of India and until now this was optional, though there were few who agreed upon this to follow such guidelines. But, according to the new financial policy, the Reserve Bank of India made it compulsory for PPIs to be interoperable.

According to the reports, interoperability will occur in three phases. In the first phase, wallets will join UPI. In the second phase, wallets will be allowed to transfer money to a bank account using UPI and in the final phase, PPIs will be allowed to issue cards. Those companies that volunteered are at an advantage as they have already started issuing cards.

At present, wallets are not able to use Aadhaar Enabled Payment System (AEPS, which a bank offers. And that is because many users have not linked their wallets to Aadhaar.


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