Prepaid cards will help fill in the gap while making inter-wallet transactions. It will give users a wider range to use their e-wallet apps.
With digital payments on the rise, the e-wallet firms and banks have joined hands to make digital transactions easier by launching prepaid cards.
IDFC Bank, RBL Bank are among the banks which have launched the concept of prepaid cards. Prepaid cards will help fill in the gap while making inter-wallet transactions. It will give users a wider range to use their e-wallet apps.
Currently, interoperabilty between e-wallets is not allowed. It means that transaction between two different wallets is not allowed. Last month, the Reserve Bank of India, in its new guidelines, said that wallets will become interoperable soon.
This restriction forces users to use specific e-wallets at shops, cafes and restaurants. For instance, a Paytm user can not use the Paytm app at a shop that has tie-up with Mobiwik. For a retailer who is in business with Mobiwik, only Mobiwik transactions will be taken into account.
As a first step to remove these hurdles, virtual prepaid debit cards are being introduced.
How will prepaid cards help in bridging the gap?
Prepaid debit cards can only be issued by banks. The concept is similar to that of Zeta cards — which are issued to employees as incentives and/or benefits. These prepaid card, like the Zeta cards, will run on the Visa or Mastercard platform. The users will need to fill in the card details like card number, CVV, date of expiry, name on the card under the debit card option (here, mastercard) for online payments. After the users have fed in the details, the online payments will be done and the money will be deducted from the e-wallet account.
The e-wallet companies will have to partner with some bank as only the banks can issue these cards.
Zeta has partnered with IDFC Bank for its operations and has now expanded its usage by issuing reimbursement cards, among others.
Along with the employee benefit cards, IDFC Bank has now partnered with Mobiwik to launch their prepaid virtual debit cards. Even though the partnership is with Mobiwik, the virtual debit card can work on every e-wallet platform. The card can be generated on any e-payment platform and can be used like every other debit card.
The prepaid card can be used on e-commerce websites for online payments as well. Amazon, for instance, does not accept direct payments from e-wallets. But if a user has a virtual prepaid debit card, it can be generated on the e-commerce platform and be used for making payments.
The only catch is that the user will be required to have a Mobiwik account to keep refilling their money. The money in Mobiwik will be deducted whenever the user makes transactions. The transactions can be made anywhere where e-wallets are accepted.RBL Bank has also launched their virtual debit cards. They have partnered with The Mobile Wallet for their operations.