What is Prepaid Wallet License in India?
As per the provision of the Payment and Settlement Systems Act, 2007, those wishing to start a Payment Wallet in India must obtain the Certificate of Authorization from Reserve Bank of India. This authorization is called the Payment Wallet License.
Prepaid payment instruments are referred to as instruments that have high monetary value. One can use them to purchase goods and services at a fixed amount. These instrument store a fix value of amount that the user needs to pay. The amount can be in the form of cash, credit card or debit.
To start a Prepaid payment instrument, known by its more popular term, the prepaid wallet, one needs to obtain Prepaid Wallet license in India.
What are the different types of Prepaid Wallets?
Following are the different types of Prepaid wallet currently prevalent in India:
· Credit Card
· Debit Card
· Paper Vouchers
· Smart Cards
· Mobile accounts
· Magnetic Strip Cards
What are the different types of PrepaidWallet License?
Following are the different types of Prepaid Wallet Licenses in India:
- Closed wallet: They are issued by a company to a customer to exclusively buy products or services of that company.
- Semi-closed wallet: The holder of semi closed wallet is only allowed to do business with certain group of sellers.
- Semi Open Wallet: The holder of semi open wallet can purchase goods at the stores that accept digital cards.
- Open Wallet: The holder can use to purchase goods and services anywhere
- Cross border transaction: The above mentioned guidelines are now for individuals with permission to use PPI instruments dominated by foreign exchange.
Eligibility requirements to get Prepaid Wallet License in India
Following are the eligibility requirement for prepaid wallet license:
- For banks and Non-banking financial institutions:
- There is no minimum capital requirement for banks and NBFCs. However, RBIs approval is still required before use of PPIs.
Entities authorized by FEMA:
- The non- NBFCs or other entities should have the net worth of at least INR 5 Crore to apply for prepaid wallet license.
- There are no minimum capital restrictions on FEMA authorized entities. However, they can only implement PPIs for a limited number of current accounts.
Documents required for Prepaid Wallet License in India
• ID proof of the applicant
• Address proof of the registered office
• Certificate of incorporation
• Memorandum of Association
• A document detailing information about the management
• Details pertaining to the statutory auditors
• Audited balance sheet
• Name of the bankers of the company
• Address of the bankers of the company.
Process to get Prepaid Wallet License in India
The process to obtain prepaid wallet license from the RBI is as follows:
- Incorporate your business as a company as per Companies act 2013
- Furnish the application for prepaid wallet via FORM A
- File the application along with the required documents
- The RBI will screen the application
- Upon accepting your application, the RBI will issue you an “In principle” – it’s the approval
- After receiving the approval, you – the applicant has to submit a satisfactory audit report to the RBI.
- The RBI will then analyze the audit report, along with the documents and your initial application.
- If the reports, the application and the documents are able to satisfy the RBI, you’ll be granted the Prepaid Wallet Approval.
Our assistance in getting you the prepaid wallet license in India
We provide end to end assistance in getting prepaid wallet license.
- Application filing
- Document drafting
- Department follow up
Thus, if you want to start a business of starting your own digital payment wallet, reach out to registrationwala.