This past week we met Mr. Ajay Adiseshann, Founder Of Paymate – A mobile payments solutions company at Startup Saturday in Mumbai. We had an interesting conversion with him on the recent RBI guidelines for credit card payments and its impact on ecommerce and mobile commerce.
Here are snippets of our discussion and Insights from the same:
In Future Banks To Decide MCommerce Limit Themselves
Ajay was of the opinion that in the near future RBI will leave it to their respective banks to set a limit on mcommerce. He stated that based on his interactions with the RBI this is already being thought over and should be implemented sooner rather than later. The premise for this would be the fact that banks are in the best position to decide the amount of risk they can take.
Credit Card Regulation Not To Have A Major Impact
Ajay also stated that the recent RBI regulation on credit card verification which is reported to have a major impact on Mcommerce as the extra pin would only be required at the time of registration for a new user. He categorically stated that for mcommerce the pin would not be required everytime one would transact via mobile. This is because the credit card would be mapped to a mobile phone.
Our Analysis
On Banks Deciding Mcommerce Limit
We feel that if this is implemented it would create a huge opportunity for mcommerce as banks themselves would be more aggressive in pitching mcommerce and it services to its customers. All in all it would open up the mcommerce market and bring more visibility to it as well.
On Mcommerce not being affected by credit card regulations
We feel this might be a little unfair as Ecommerce players will suffer badly as each time a card transacts online it would need the extra master or Visa pin but on mobile if thats not the case then the case for mcommerce and ease of mcommerce is highlighted in a big way. As stated by us in our earlier story.. Ecommerce desperately needs ewallets to give it a fillip in India’s market.
I do not necessarily agree with Mcommerce not being effected by credit card regulations. Mcommerce in india is at a nascent stage, far behind e-commerce. Card not present txns on the internet are repudiable. Hence, in order to protect consumer interest and the merchant’s interest this was much needed. However, what really perplexed me is that the regulator has looked at card security in isolation, seperately for e-commerce and m-commerce. They should have insisted on a numeric PIN rather than an alpha numeric PIN or purely alpha and all such variants. A common numer PIN based on a PIN issuance guideline around it could make it usable on mobile as well. Once Mcommerce really takes of india, you will notice instances of card repudiation. For mcommerce to succeed, security is an important aspect and it will encourage people to use their mobile phones to transact.