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The Reserve Bank of India (RBI) has thrown in a lifeline for some pre-paid instrument (PPI) players by re-introducing the facility of small value digital payments with minimum KYC norms, albeit a stricter version.
The concept of minimum KYC — which comprised a mobile number to be verified, and a self-declaration of name and unique identity/identification number — was available until two years back, but was withdrawn.
It is now making a comeback through the introduction of a new type of semi-closed PPI up to ₹10,000 per month (not exceeding ₹1,20,000 in a financial year) with loading only from a bank account. Also, the amount outstanding at any point of time in such PPIs should not exceed ₹10,000. In this stricter version of KYC, as the money will have to be loaded on to a semi-closed wallet from only a bank account. Also, the amount cannot be used for funds transfer.
The re-introduction of minimum KYC PPI is a positive move by the RBI and would accelerate growth of digitisation in the country, said Navin Surya, Chairman Emeritus, Payments Council of India.
“This would also help PPI players to further accelerate their growth with increased digital micro spends in our country”, he said. This category of up to ₹ 10,000 per month digital spend was a fast growing one and useful for those who were hesitant to try digital payments.
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