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Online cab-hailing service Uber said that it is developing a closed wallet service in India, according to this report from the Economic Times. Uber confirmed the development in a PTI report and said that it finds the RBI’s diktat on two factor authentication for card payments too cumbersome, and is hence launching a service of its own. In India, Uber rides can be paid for through Paytm wallets, Airtel Money, debit and credit cards, and cash as of now.

The PTI report also quoted Uber India’s president Amit Jain saying that the customer experience was being hampered because of the need to enter multiple digits after a ride. “We will continue to evaluate options until we have seamless payment experience from the consumer which does not exist in India today,” he told the publication.

MediaNama was unable to reach Uber despite multiple attempts to confirm this.

Closed wallet is short sighted
The ET report adds that Uber is looking to develop a closed wallet that would not require RBI authorization, with commuters being able to add up to a maximum of Rs 5,000. This would be a short-sighted move by Uber. 

Readers will remember that Ola too had a closed wallet but ran afoul of the RBI’s guidelines as the company is a cab aggregator. Closed system payment instruments do not permit cash withdrawal or redemption and cannot facilitate payments and settlement for third-party services.

Cab aggregators such as Ola and Uber say that they are technology firms which connect users to cab drivers and hence in this case, the drivers can be considered third parties.

Subsequently, Ola tied up with ZipCash for its wallet services which also allowed Ola Money users to pay for other services such as OYO Rooms, Saavn, Lenskart, Zo Rooms and TinyOwl.

If Uber’s focus in the wallet in India is about making payments seamless, it needs to go the Ola Money way. Uber could also focus on payments for public transportation such as buses, trains and metros (come on Uber, you want to fix transportation problems, here’s one). It’s also very surprising that despite the huge influx of wallets in the country, no one has tried to fix public transportation payments. It’s something that all wallet players could look into.

Ridlr cashless rides: So far, it seems only public transportation information app Ridlr is allowing users to pay for bus fares via a wallet (on limited bus routes only). Ridlr tied up with Citrus Cash for wallet services and money will be deducted every time a user books a ticket. The bus conductors on these routes carry a mobile device which can verify the e-ticket from the app. The Ridlr app connects with the bus conductor’s mobile device via a combination of Bluetooth and wireless technology.