The Reserve Bank of India (RBI) asked all payments banks to get customers’ information verified themselves or by third parties (provided they are regulated), at their option, to ensure compliance under the Prevention of Money Laundering Act (PMLA).
Under these considerations, telecom companies operating payments banks may see costs associated with KYC authentication. At the same time, while telecom operators will be facing the heat of RBI’s new ordeal, Paytm claims to have completed KYC for close to 55 million of its wallet customers. Around October, the company had also stated that it will be investing USD 500 million in KYC operations. Other telecom operators that hold a payments bank licence include Airtel, Jio, and mPesa.
In October 2017, RBI had also revised the guidelines on operability of digital wallets in India. During that time, it had stated that wallets need to be fully KYC-compliant, with minimum KYC-compliant wallets requiring to be converted into fully KYC-compliant accounts within 12 months.
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