RBI nixes MobiKwik’s offer of 6% return on wallet balances: report
Digital wallet MobiKwik has withdrawn its offer of ‘6% annual profit’ to customers who hold a wallet balance above Rs 5,000 after the Reserve Bank of India (RBI) said that the scheme was not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.
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Loophole found, similar scheme back with different terminology.
oh oooh!
@thrifty_indian wrote:
PAytm was about to do the same but Mobikwik stole it in a jiffy to take the lead.
Payrm won’t do, as paytm bank it will be legalised.
5000 !!!!!!!!!!!!!!!
I wouldn’t trust these fraudsters with my 500 Rs. Mobikwik has been the worst website. I don’t how they are surviving
Update In a conversation with newsagency, MobiKwik’s COO Mrinal Sinha said that the company is talking to the RBI to clear matters on the scheme. He also said that the communication on the offer wasn’t clear enough and that the company will be continuing the scheme as a loyalty programme. He added that MobiKwik has no intentions of building a deposit base.
“We have seen that users sometimes spend more than Rs 10,000 on the wallet, so we introduced this scheme so that they would not keep loading their wallet again and again and offer them some reward in the form of cashbacks,” Sinha added.
Regarding, the ‘core portion’ of the funds used to earn interest in a separate account, Sinha did say that this was a revenue stream for the company.
Separately, MobiKwik CEO Bipin Preet Singh sent a statement:
MobiKwik is the most rewarding loyalty platform for users. Loyalty points, incentives, cashbacks, etc. are among the benefits to MobiKwik users for going cashless. We launched the profit cashback offer as part of an overall package of incentives, to reward our existing users and encourage more users to load & therefore transact on MobiKwik. There were certain concerns on the language of the campaign that were flagged to us and we are working with the regulators in resolving these concerns so we can continue with the offer.
PAytm was about to do the same but Mobikwik stole it in a jiffy to take the lead.