5 things that will help you decide if you should put your money in a mobile wallet
There are many things of mobile wallets that still remain relatively unknown to many.
The mobile wallet market in India has been growing considerably with government's push towards a cashless economy. It is expected to reach $6.6 billion by 2020, according to a TechSci Research report and is helping the government's initiative to reaching out to the 233 million unbanked Indians.
However, there are many things of mobile wallets that still remain relatively unknown by many. Here are 5 things you did not know about mobile wallets:
1. Money limit in mobile wallets: As per current Reserve Bank of India (RBI) norms only Rs 10,000 can be put into your account if you have a non-KYC (Know Your Customer) account. This means that if you have just created in an account without any background checks done by the company you will be limited to only transacting with only Rs 10,000 in your wallet.
2. Limit can be raised to Rs 1 lakh: The limit of money in your account can be increased to Rs 1 lakh once your KYC is approved by the company. This can be done by visiting a mobile wallet company's KYC centre and submitting certain documents.
3. Types of mobile wallets: Mobile wallets are categories into three types ie, closed wallets, semi-closed wallets and open wallets. Closed wallets can be used only for a particular company's goods and services. For instance, most ecommerce sites such as Makemytrip, Snapdeal, Jabong have closed wallets where refund amounts can be credited into your company held account.
Semi-closed wallets also do not allow any redemption or cash withdrawal. However, the difference is that they can be used to buy goods or services at several other platforms that it has tied up with. Examples of this include, Paytm, MobiKwik, PayUMoney, Oxigen, Freecharge, etc. These are currently the most widely used in India.
Open wallets allow redemption as well as cash withdrawals. They also have all the other features offered by semi-closed wallets. An example of this, is Vodafone's m-Pesa which allows you to withdraw, deposit or transfer cash from your wallet.
4. Services offered: Most mobile wallets have tie-ups with ecommerce site and offer discounts in the form of cash-back offer additional benefits to customers. Apart from this, many mobile wallets also offer certain discounts in the form of coupons with the ecommerce players it has tie-ups with. There is also a certain level of safety that users get when transacting with mobile wallets than using credit or debit cards.
5. Interest: MobiKwik is the only mobile wallet in India that offers interest to its users. It recently announced 6% interest per month on the average balance.