Mobile Wallet License comprehensively determines the authentication of digital payment networks in a sophisticated manner. Its License provides instantaneous support in establishing the legal validation concerning online transactions in multinational corporations and companies on a wide platform. As the era of digitalization is enhancing, people are placing their reliance upon online facilitation for payments and other banking systems. The License accentuates a smooth and efficient structural pattern of digital payments on a broad scale. It helps in forming a substratum for a robust digital makeover. Digitalization has transfigured the framework of monetary systemization and it has also revolutionized the economy of the country to a larger extent. Mobile Wallet License acts as a shield against the illegal utilization or employment of money by companies or enterprises as it adjoins the structural framework of digital payments with the ideal pattern of law. In this blog post, a comprehensive perspective has been advanced in the direction of analyzing the context of a Mobile Wallet License in a detailed format.

Mobile Wallet License

India’s development is accelerating as a result of the digitization of payment transactions. People’s lives have changed so that using digital wallets for payments is now the new standard. To prevent any risk of fraud, regulators are in charge of regulating these transactions.

The future of mobile wallets seems promising, but before any firm can begin using them, it must obtain a mobile wallet license from the RBI, also known as a prepaid wallet license. The Payment and Settlement Systems Act of 2007 states that this criterion is non-negotiable According to the RBI, prepaid payment instruments include mobile wallet licenses (PPIs).

Kinds of Mobile Wallet License

The following are the kinds of a Mobile Wallet Licenses:-

·         Closed wallets: Customers are given exclusive virtual wallets by online retailers in exchange for making in-person purchases. Closed wallets are most prevalent in the e-commerce industry.

·         Semi-closed wallet: As the name implies, these wallets continue to work for a particular group of people.

·         Semi-Open Wallet: This type of wallet enables users to make purchases from merchants that accept electronic payment methods.

·         Open Wallet: Due to its flexibility, the open wallet can be used in a wide range of situations.

·         Cross-border transactions: According to updated RBI standards, cross-border transactions over the internet are now also possible.

Advantages of a Mobile Wallet License

The following are the advantages of the Mobile Wallet License:-

·         Prepaid wallets are digital versions of traditional wallets; therefore it is almost unfeasible that they could be stolen or lost.

·         Payments in small amounts can be made without difficulty using these wallets.

·         A mobile wallet almost instantaneously completes the transaction. Contrary to internet banking, where transactions appear in the account after a day, this is not the case.

·         The majority of prepaid wallets don’t have any recurring or hidden fees like internal banking.

·         The majority of prepaid wallets provide users with referral bonuses.

·         When it comes to adding money using debit cards or online banking, mobile wallets are incredibly quick.

·         Automated loan or credit payback is possible for payment wallet users.

Qualifying Standards Concerning the Mobile Wallet License

For obtaining a Mobile Wallet License in India, the following criteria must be met:

·         The minimum capital requirement does not apply to banks or non-banking financial firms.

·         The Reserve Bank must provide its consent.

·         About non-NBFC

·         Rs. 5 crores is the required minimum net worth.

·         Firms with FEMA certification

·         There is no minimum capital requirement

·         Access to PPIs is not widely available.

Essential Documentation

Following are the significant documents in the context of obtaining a Mobile Wallet License:-

·         Proof of the applicant’s identity

·         Proof of the registered office address

·         A certificate of incorporation (COI)

·         Memorandum of Association (MOA)

·         A report outlining the specifics of the management structure

·         Information about statutory auditors

·         A tallied financial statement that has undergone an audit

·         Name and address of the designated banker who handles business transactions for the company

Procedure

The Reserve Bank of India’s comprehensive application procedure for obtaining a Mobile Wallet License is as follows:

·         Create a legal corporation by the 2013 Companies Act.

·         Get the FORM A from the Reserve Bank Portal.

·         Complete the form properly and include all necessary information.

·         The application must be attested with the required documents before being sent to RBI.

·         A grant of approval known as “In principle” will be given after the inspection process is put into action.

·         The next step is for the applicant to inform the RBI of the positive audit.

·         When RBI checks the audit report and other crucial documents for any legal errors, it will be the final examination that takes place.

·         Prepaid Wallet Permission will be granted following the positive vetting.

Validity concerning the Mobile Wallet License

The Prepaid Wallet License is issued by RBI and has a minimum term of one year, beginning on the date of the most recent loading or reloading.

·         PPIs are capable of having their validity extended.

·         The Reserve Bank^[1] grants an authorization certificate that is valid for 5 years. The certificate is still subject to examination and perhaps revocation, though.

·         Consumers using a PPI-issued valid card can also seek its replacement.

·         A payment instrument must maintain an outstanding balance of no more than 10% of the outstanding value per month.

·         For a few days after the instrument ceases to function, the balance should still be there.

·         When the PPI service expires, license holders must promptly notify the appropriate authority.

Conclusion

Mobile Wallet License maintains effective operational management of digital payments. Digitalization of monetary sources has proved to be an efficient source for regulating an efficacious model of economic structure. Mobile Wallet License determines the integrity of the structural pattern concerning online payment systems. This trend of digital makeovers will increase on a large scale further. Our legal luminaries at BizAdvisors.io provide a robust support system in the context of assisting individuals to easily obtain a Mobile Wallet License. You can freely contact our legal consultants at BizAdvisors.io for any kind of professional assistance or help in the context of the structural framework of the Mobile Wallet License.

Read our article:Procedure for Obtaining Online Payment Gateway License in India