Amazon India gets digital wallet licence; to take on Paytm and Flipkart's PhonePe

Online marketplace Amazon India has been granted licence from the Reserve Bank of India (RBI) to operate a prepaid payment instrument (PPI), becoming the latest entrant into the country’s growing FinTech segment.

"We are pleased to receive our PPI license from the RBI. Our focus is providing customers with a convenient and trusted cashless payments experience. RBI is in the process of finalising the guidelines for PPIs. We look forward to seeing a continuation of the low limit wallet dispensation with simplified KYC & authentication," said Sriram Jagannathan, VP Payments, Amazon India.

RBI has issued the wallet license in the name of Amazon Online Distribution Services which also operates Amazon Pay, a payment option similar to mobile wallets, except that it is restricted to transactions on Amazon. However, now just like Paytm, MobiKwik and other wallets, Amazon's wallet could be used in other places as well.

"We recently launched Amazon Pay where customers can fund their pre-paid balance using internet banking and credit or debit card for smooth purchases and payments. With this, customers can go cashless and enjoy fast and easy checkouts, quicker refunds coupled with a secured shopping experience only on Amazon.in. We will continue to look for ways to improve customer experience and increasing digital payments leveraging our PPI license," added Jagannathan.

The e-tailer, however, did not disclose whether, after securing a full-fledged wallet licence, it will open Amazon Pay to other platforms as well.

Amazon joins the league of 84 companies which have licences from RBI. The launch of the wallet will put Amazon in direct competition with companies like Paytm, Flipkart’s PhonePe, MobiKwik and FreeCharge. Amazon India's wallet license also comes at a time when Flipkart, which has recently raised $1.4 billion, is planning to actively invest in the payments business called PhonePe.