RBI Puts Mobile Banking On Hold

RBI Puts Mobile Banking On Hold

Techtree News Staff, Jul 28, 2008 1200 hrs IST

Citing consumer rights, RBI has asked all banks to put mobile transactions on hold until guidelines are issued.

In an unprecedented move, the Reserve Bank of India (RBI), has asked all leading financial institutions in the country to put mobile payment services on hold till final guidelines are drafted and issued for such transactions.

Currently, there are no norms governing this kind of transactions, which are gaining in popularity as they are very convenient. The RBI does not want to allow payments in the absence of proper norms. "What is the hurry when the final guidelines will be issued soon?," an official wondered.

The RBI clarified that these guidelines will affect only payment services and not basic services like mobile alerts for credit or debit entry, balance enquiry or other services that are in the nature of providing information. Meanwhile, the RBI has also directed all banks to dissociate themselves from any mobile-based money transfer service that has not received "explicit approval".

When queried about the new directives, executives at Bharti Airtel, which is one of the leading players in the mobile banking markets, quipped "We are not transferring any money; we are merely passing information". He also added that the latest move will not adversely affect any of their plans.

The RBI aims to streamline the entire mobile payment services market as it is still an unorganized sector which is in need of a set of guidelines to ensure protection of consumer interest.

Source: Business Standard