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RBI puts temporary block on mobile payments

Well-made advertisements from Airtel featuring Madhavan and Vidya Balan, promoting mobile payments will not be seen for sometime. The reason being that RBI has temporarily stopped mobile payments. The below text was received by me as a forwarded mail. Please check with your bank and service providers.

India's central bank has ordered the country's financial institutions to cease mobile payment services until it has issued procedural guidelines. The Reserve Bank of India reportedly sent a notification to the institutions to inform them that it was compiling and evaluating comments on the payments following its posting of draft guidelines on its web site last month.

Some banks, however, have already started to offer these services to customers. ICICI bank launched iMobile in January, which enabled clients to use their mobile phones to transfer funds and pay bills. Yes Bank in March collaborated with Obopay, a Canadian start-up company, to launch a person-to-person money transfer service.

The RBI is still allowing banks to offer basic account information to customers — such as credit and debit alerts and balance enquiries — through their mobile phones. The RBI's published draft guidelines reportedly required mobile payment services to comply with standard money laundering and "know your customer" rules. They also required the services to adopt the message formats that the Mobile Payments Forum of India was developing to ensure interoperability.

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