Mobile banking grows but m-wallet growth slows in 2018-19

Mobile banking grows but m-wallet growth slows in 2018-19
Photo Credit: Photo Credit: Thinkstock
14 May, 2019

The volume of mobile banking transactions jumped 230% to around 6.2 billion during the financial year 2018-19, Reserve Bank of India data show. The total value of transactions rose to Rs 29.58 trillion from Rs 14.72 trillion.

The data, released in the RBI’s monthly bulletin, also showed a 33% increase in the volume of payments through pre-paid Instruments such as mobile wallets. The total value of transactions through PPIs for 2018-19 rose to Rs 2.13 trillion from Rs 1.42 trillion in 2017-18.

Over the last year, transactions through mobile wallets have declined after the Supreme Court ruled that digital wallets cannot use the government’s unique Aadhaar identification number for electronic know-your-customer verification process.

The RBI had also issued guidelines to mobile wallets to complete the KYC verification of customers within a year of opening the wallet, failing which the wallets would be marked as inactive. This has seen wallet majors like Paytm and Amazon Pay resorting to physical verification of customers.

Mobile wallet transactions spiked after the government’s demonetisation of high-value banknotes in late 2016 and rose from 75.3 million in September that year to 324.16 million transactions in September 2018. For March 2019, the number of transactions using mobile wallets stood at 384.89 million, indicating a slowdown due to the change in e-KYC norms.