Prepaid payment instrument companies have approached the Reserve Bank of India seeking relief from proposed restrictions on wallet transactions, warning that the measures could adversely affect business growth and slow the momentum of digital payments in the country.
Industry players said the draft norms, if implemented in their current form, could significantly impact wallet usage and transaction volumes. The RBI has proposed capping monthly debit transactions through PPIs at Rs 2 lakh, limiting person-to-person transfers to Rs 25,000 per month, and reducing the cash-loading limit to Rs 10,000 from the current Rs 50,000.
Executives at several PPI firms said the proposed limits may make wallet products less attractive for users who rely on them for frequent and higher-value transactions. They cautioned that the move could hurt transaction growth and weaken the business case for wallet operators.
The industry has also expressed concern that the tighter norms could discourage investments in customer onboarding processes, including video-based know-your-customer verification, as firms reassess the economics of acquiring and servicing users under the proposed framework.
Major PPI operators include Amazon Pay, Navi, Mobikwik, PhonePe, Pine Labs and Razorpay.
Industry representatives have urged the central bank to adopt a graded implementation strategy rather than introducing the restrictions across the board. They have proposed that the RBI first conduct a pilot programme involving a limited set of users to assess the impact of the measures on wallet usage and transaction volumes.
"As policymakers consider changes to the framework, it is important that regulatory measures remain proportionate and risk-based, balancing consumer protection with accessibility, innovation and ease of use. A phased and evidence-based approach can help strengthen the ecosystem while preserving the benefits that have driven widespread adoption,” said Abhishek Jha, fellow and vertical lead, corporate advisory, Pahle India.
According to industry executives, a pilot would help regulators evaluate whether wallet transactions decline sharply under the proposed limits and allow for course corrections before a wider rollout.
The RBI is currently reviewing feedback from stakeholders on the draft framework. Industry participants said they remain engaged with the regulator and are hopeful that concerns around business viability and digital payment growth will be taken into account before the norms are finalised.
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