Telecom, Banking and e-Governance are converging in India, thanks to policy intervention of the Indian Financial Regular, RBI.
RBI has issued guidelines for pre-paid payment instrument, under the Payment and Settlement Act 2007.
In its guidelines document, RBI defines four categories of pre-paid instruments:
• Closed: These are the pre-paid charge cards issues by Telcos, commonly known as top-up cards.
• Semi Closed: These instruments allows for paying for goods in pre-defined establishments having explicit agreement to accept the card with the Telco.
• Semi Open: These instruments can be used in any establishment accepting Credit or Debit Cards. But no cash can be withdrawn from ATM.
• Open: These cards can be used in any establishment as well as cash can be withdrawn from ATM.
The Telecom operators can only apply for Closed and Semi-Closed payment instruments. Thus Telcos are forming 51-49 Joint Ventures with Banking Institutions to overcome this limitation. In near future, all Telecom operators will have Open payment instruments
The Phase-III is detailed in the second whitepaper attached below.