Uber has introduced a wallet-based payments option to its Indian service in order to finally comply with Reserve Bank of India regulations.
The RBI insists on a two-step credit card verification procedure for processing payments. The global taxi-hailing company stores credit card details of passengers and automatically charges the card once the taxi ride is over without two-factor authentication, using an international payment gateway. Uber’s payment protocol has ruffled feathers with regulators worldwide, especially in India. Luckily for Uber, the RBI allowed the company an extra month to make changes, extending its October 31st deadline by a month.
The new wallet system is powered by Indian company Paytm. It allows customers to essentially pre-pay for their rides in rupees by filling up their virtual wallet from a debit card or bank account. Uber will deduct payments directly from the wallet rather than the debit card or bank account.
Uber will allow the wallet to reach a negative balance if a customer has insufficient funds to pay their fare, TechCrunch confirmed. The app will then prompt the customer to return their wallet to credit after the ride.
International credit cards can still be used, Uber announced in a blog post. But rather than attribute the change to RBI regulations, the company highlighted the benefits of the new system for customers with a tighter budget – a growing target market since the company reduced fees by 25 per cent.
“We hope these new choices will enable the lone woman traveler to get around safely, or the college student on a budget to get around cheaper with the fare split option.”
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