Amazon, payments body want RBI to relax KYC norms for low-value transactions
Amazon is approaching the Reserve Bank of India to exempt it and its e-wallet, Amazon Pay from complying with the full ‘KYC’ norms.
The norms for ‘Know Your Customer’ have been tightened over the years and as per the last standing instructions from the regulator, all e-wallets and pre-paid instruments operators have to have their KYC process in place before the end of February this year. It was supposed to have been done by December 31 but the RBI gave the players a two-month extension. Now, what Amazon is asking for is to do away with the full KYC norms as far as people who do small value transactions are concerned.
And it is not Amazon alone; the industry has got together under the banner of the Payments Council of India (PCI) and a committee constituted by PCI called Prepaid Payment Instruments, headed by no less than the Vice President of Amazon.
The trade body is making a collective representation to the RBI to withdraw the February 28 deadline for KYC norms in respect of their customers and they have suggested that transactions below Rs 10,000 be exempted from this regulation.
According to them, 90% of the transactions they handle are below this threshold and any move to compel these customers to submit elaborate documents in compliance will drive them away from their business and they want RBI to reconsider this decision.
They would want the rule to be applied based on the value of the transactions and not simply as a time-based rule across the board.
The one strong argument they are putting forth is that these people may switch back to paying by cash, defeating the very concept of Digital India being promoted by the government.
PostedOn: 17 Feb 2018
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