Digital wallet MobiKwik has withdrawn its offer of ‘6% annual profit’ to customers who hold a wallet balance above Rs 5,000 after the Reserve Bank of India (RBI) said that the scheme was not allowed,
Accordingly, all promotions regarding the scheme on the website and app have been removed.
MobikKwik launched the product on June 1st which was similar to interest earned on savings bank account and offered it as a monthly cashback to customers. The Mint report added the the RBI would not allow wallet companies “to mobilise funds/deposits by offering cash back in nature of interest etc.” At the launch, MobiKwik said that all wallets were allowed to earn interest on balances with escrow and it was passing it on to customers.
A MobiKwik spokesperson said that company cannot comment on the issue at this point. Calls made to MobiKwik co-founder Upasana Taku could not be connected. We have left MobiKwik and Taku an email and will update once we hear from them.
It seems that MobiKwik was using a loophole in the RBI’s guidelines which would allow them to transfer a ‘core portion’ of the funds in escrow accounts into a separate account on which interest is payable.