Monetary policy: Soon, you can withdraw cash from digital wallets

The rationale behind this move is to level the playing field between banks and non-banks PPI issuers

The Reserve Bank of India (RBI) on Wednesday proposed to make interoperability mandatory for digital payments firms. It also allowed users to withdraw cash from e-wallets and fintech companies to process RTGS and NEFT transactions.

The RBI expressed dissatisfaction over prepaid payment instruments’ (PPIs’) failure to migrate towards full-KYC (know your customer) PPIs, and therefore interoperability, even two years after guidelines were issued.

Hence, it proposed to make interoperability mandatory for full-KYC PPIs and for all acceptance infrastructure. And, in order to incentivise the migration, it permitted the full-KYC PPIs to hold double the outstanding balance they can currently hold — from