As the RBI August 31 deadline for full KYC is round the corner, digital payment players are finding themselves in trouble and are counting upon the central bank for some digital Know Your Customer options.
Even after several extensions in KYC deadline for e-wallets by the RBI, the National Association of Software and Services Companies (NASSCOM) has urged to the banking regulator, government and the Unique Identification Authority of India (UIDAI) to further extend the deadline for 7 more months i.e till March 2020. This will provide industries with the ample time to install digital KYC process along with abiding by the regulatory precept.
Calling XML based KYC a daunting job in such a short time, and since its failure rates are as high as 57%, NASSCOM has appealed to RBI to mull over video KYC which is a convenient alternative for the same.
Notably, the share of full KYC is still less than 15% and the August deadline is advancing. Moreover, the cost involved in the process is way too high but the extension is beneficial as long as the regulatory body grants access to mobile wallet firms for using digital KYC channels.
Meanwhile, the central bank is taking into account the alternate electronic channels roping in DigiLocker online service platform.
Back in May 2019, the government allowed non-banking entities that are bound by Section 11A of the Prevention of Money Laundering Act, 2002 to access the Aadhaar database for e-KYC authentication.
Previously, the digital payments major Paytm made representations to the RBI to allow minimum KYC wallets to remain operational even after the banking regulator’s deadline.
Now the question that resides is will the wallet operators come up with an alternative viable route for e-KYC within a month?
This development was first reported by ET.