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RBI selects six companies in first cohort for regulatory sandbox; two names announced, four to follow

The RBI has shortlisted two companies for its regulatory sandbox programme built on the theme of retail digital payments. Both the companies are working towards helping digitise rural payments through innovative means.

November 17, 2020 / 05:37 PM IST

The Reserve Bank of India (RBI) has named two startups in the first cohort on retail digital payments as a part of its regulatory sandbox programme. In a notification, the central bank said that 32 companies had applied for the sandbox programme, of which six have been shortlisted.

While two companies have been announced on November 17, four more will be announced shortly, the RBI said. The initial two are National Support Consultancy Services from Jaipur and Nucleus Software Exports, based in Noida.

The regulatory sandbox is a protected environment within which the selected companies will operate. Here they will have to show their system's preparedness while dealing with dummy data. Once they achieve success within the protected environment, the systems will be allowed to be tested in the live environment with actual banks and consumer data.

The Jaipur-based organisation is testing its product named 'eRupaya', which is a near-field communication or NFC-based prepaid card and an NFC-enabled point of sales (POS) terminal which will allow digital payments to take place completely offline.

Nucleus Software Exports is working to connect rural areas with electronic payments, mainly by leveraging the self-help group network. It is trying to create a digitised self-help group ecosystem.


While the application to the first cohort had opened back in November 2019, the RBI said that programme implementation and selection of the finalists had been delayed because of the COVID-19 pandemic.

The central bank is using the programme to identify innovations across three sectors -- offline payments, feature phone-based payments and contactless transactions.

The RBI has been pushing for innovation in the offline payments space since the regulator believes that rural payments can be digitised through contactless and NFC mechanisms.

It also wants to reduce transaction failures caused by slow internet speeds in the rural areas of the country. Hence, the regulator is looking for solutions to these problems through the sandbox mechanism.
Pratik Bhakta
first published: Nov 17, 2020 05:37 pm

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