State Bank of India's (SBI) mobile wallet, SBI Buddy, should not allow cash withdrawals. SBI MD Rajnish Kumar has told multiple media outlets that the bank is allowing cash withdrawals from the wallet via ATM from June (onwards) with a charge of Rs 25 plus Rs 3.5 service tax; additionally, cash withdrawals from Business Correspondents from the mobile wallet will be charged 2.5% of the transaction plus service tax. But here's the thing: SBI Buddy is a semi-closed prepaid wallet - which it also clearly mentions in its FAQs - and the Reserve Bank of India (RBI) guidelines for semi-closed wallets do not allow cash withdrawals from semi-closed prepaid wallets. Note that SBI had to issue a clarification recently after a widespread outcry when it posted a circular which said that ATM withdrawals will be charged Rs 25. It later said that only cash withdrawals from the Buddy wallet will be charged. We don't quite understand how cash can be withdrawn from SBI Buddy anway. At the time of filing this report, SBI MD Rajnish Kumar was unavailable in his office. MediaNama has sent an email seeking comment about the same and will update once we hear from them. Need an open wallet to withdraw cash Note that there has been an instance where a wallet player has allowed cash withdrawals, but that was done via an open prepaid wallet, not a semi-closed one: open wallets allow cash withdrawals, and ItzCash had tied up with RBL Bank to launch a ‘Rupay Platinum Prepaid Card’ which would allow users…
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