The Reserve Bank of India (RBI), in its latest regulations, has directed Prepaid Payment Instruments (PPI) issuers to stop providing Unified Payments Interface (UPI) services in a co-branding arrangement, which also includes fantasy sports platform’s Dream11’s DreamX that was launched recently.
PPIs are tools that make it easier to pay for products and services, conduct financial transactions or allow remittance services. While debit and credit are also an example, only UPI is included in the current change.
The latest regulation is to make sure UPI can be used openly and cannot be confined by a company for payments only on their respective platforms.
“PPI holders shall be on-boarded for UPI by their own PPI issuer only. PPI issuer shall only link its customer wallets to the handle issued to it. PPI issuer as PSP shall not on-board customers of any bank or any other PPI issuer.” the statement says.
As reported exclusively by Entrackr, this means that online apps using UPI like DreamX by Dream11, Fampay, and such other integrated and co-branded UPI service providers will have to stop their services as they do not hold a PPI licence. Currently, apart from getting a licence, there is no other way for these companies to enable UPI transactions.
Breaking: RBI asks PPI issuers to stop UPI in a co-branding arrangement
As per RBI, PPI holders shall be on-boarded for UPI by their own PPI issuer only
The move will force companies such as Dreamx, Fampay, Akudo, Muvin to discontinue UPI services as they don't hold PPI license
— Harsh Upadhyay (@upadhyay_harsh1) June 27, 2023
DreamX was launched recently by Dream Sports, parent company for one of the biggest fantasy sports platform in India, Dream11. It was introduced right before the Indian Premier League 2023 in a joint association with fintech platform Pine Labs as a way for players to add money to the wallet and spend their winnings on the platform.
While it was a great move, only the players who have account on Dream11 could use the application and people cannot use the DreamX app as a standalone UPI payment option, which the RBI, currently, has imposed a restriction on.