E- Commerce giant Amazon India has finally obtained permission and approval from the Reserve Bank (RBI) to work on a prepaid instrument or digital wallet. The Amazon Online Distribution Services (AODS), a subsidiary of Amazon Asia Pacific Resources, was granted the license on March 22. The license is valid till the end of fiscal year 2022.
The permission is obviously a great step towards the growth at a time when the digital payments space taking step upwards with great level of engagement by leading internet-based startups in the country. Amazon last year made an investment of Rs 150 crore in AODS with the aim of contributing in this space.
Well, on the other hand, the other e-commerce giant ‘Flipkart’which considered as top rival of Amazon also has determined plans for its payments business under the PhonePe brand. The approval from RBI for the Amazon, places a stage for a ferocious competition between the company and Flipkart in the payments business too.
Since the start of 2017, Amazon has been actively involved in encouraging Amazon Pay, which lets users to pay online on the marketplace - it makes the check-in and check-out process easy by using information already stored in the Amazon account.
"We are pleased to receive our PPI (prepaid payment instrument) license from the RBI. Our focus is providing customers 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. This will allow us to help customers adopt digital payments at scale and thereby contribute towards making India a less cash economy," said Sriram Jagannathan, VP-payments, Amazon India.
As per the recent scenario, Alibaba-backed Paytm is regarded as the major wallet player in India. Other minor players include Mobikwik and Freecharge.