Relief to e Wallet Users

Relief to e Wallet Users

BE/RBI NOTE/01/2019


Customers using prepaid instruments and incurring liabilities due to fraud in the incidents are now given the relief if they report the fraud within three days.  This is similar to that of the rules applicable for bank frauds.

  • Prepaid payment instruments(PPI) include
    • Mobilewallets,
    • Prepaidpayments cards and
    • Paper vouchers such as Sodexo.
  • RBI adds that If it is a third-party breach, where the wrongdoing is neither on the part of the PPI issuer nor the customer but elsewhere in the system, the customer will have no liability if they report it within three days.
  • At present, for banks, the rules are already in place, but the latest notification expands the sphere of customer protection.
  • This is referred to be an increase in the window of reporting fraud.


  1. If the fraud is reported within four to seven days, the liability will be the Transaction value or Rs.10,000 per transaction, whichever is lower.
  2. Considering PPIs are loaded typically with less than Rs.10,000, this typically means that for a delay of three days the user will have to incur the full loss.
  3. Further, this means that wallets are being treated on par with banks and cards.
  4. This would technically offer liability protection and would boost consumer confidence
  5. If the fraud or error is reported after seven days, the board-approved policy of the PPI will prevail. 


  1. This means all customers will now be brought to the same level with regard to electronic transactions made by them
  2. In case the loss is due to the negligence of a customer like
    1. He/she has shared the payment credentials,
    2. A customer has intentionally committed the fraud

    the customer will bear the entire loss until he/she reports the unauthorized transaction to the PPI issuer.

  3. Any loss occurring after the reporting of the unauthorized transaction shall be borne by the PPI issuer
  4. The guideline further adds that in order to facilitate reporting, PPI issuers will have to provide customers with “24×7 access via website/SMS/email/a dedicated toll-free helpline,”.
  5. There should also be a direct link on the PPI issuers’ website.
  6. Once complaints are lodged, the customer should be provided with an “auto-response” to acknowledge the receipt of the complaint.
  7. In order to ascertain the liabilities of the customer, the communication systems used by PPI issuers to send alerts and receive their responses thereto shall record time and date of delivery of the message and receipt of customer’s response if any.
  8. The PPI issuer will have to immediately work on the complaint to avoid any further unauthorized use.
  9. Depending upon the timing of the complaint lodged, the notional amount defrauded, or decided as a liability, should be reversed to the customer’s prepaid account within 10 days of the complaint.

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