The Reserve Bank of India (RBI) has asked PPI issuers to stop Unified Payments Interface (UPI) in a co-branding arrangement, according to the directions.
“PPI holders shall be on-boarded for UPI by their own PPI issuer only. PPI issuer shall only link its customer wallets to the handle issued to it. PPI issuer as PSP shall not on-board customers of any bank or any other PPI issuer,” mentioned the direction.
RBI has also communicated this to PPI issuers through email. Entrackr has reviewed the copy of the email.
The move will force companies such as Dreamx (Dream11), Fampay, Akudo, Muvin to discontinue UPI services as they do not hold PPI license. Significantly, there is no other arrangement left for these companies to enable UPI on their applications, except securing a PPI license which is tedious and hard to get hold on.
Dream11 and Akudo declined to comment on the story while Fampay and others didn’t respond to our immediate queries. Meanwhile, responding to Entrackr’s queries, Decentro’s co-founder Pratik Daudkhane said, “We had phased out PPI as a product some time back. In hindsight, it looks like the right decision.” Entrackr has reached out to all these companies for response. We will update the story as and when we receive them.
For context, the aforementioned companies offer UPI services through a co-branded arrangement through a non-bank PPI license holder.
Dream11’s DreamX runs its UPI service in a co-branded arrangement with Pine Labs while Fampay’s UPI is powered by Tri O Tech Solutions Private Ltd. LivQuik Technology (India) Private Limited is a PPI issuer for Akudo and Muvin for their UPI.
While RBI hasn’t given any reason for discontinuing co-branded arrangement as far as PPI on UPI is concerned, sources indicate that the regulator wasn’t happy with some recent partnerships.
