Comments
The Reserve Bank of India on Wednesday issued final guidelines for prepaid payment instruments (PPI) such as closed, semi-closed and open wallets. According to the new guidelines, all the PPIs will now be interoperable, which means will allow transaction with each other.
The RBI said that interoperability shall be enabled in phases for the PPIs and that in the first phase, the issuers (both bank and non-bank entities) shall make all KYC-compliant PPIs issued in the form of wallets interoperable amongst themselves through Unified Payments Interface (UPI) within six months from the date of issue of the guidelines.
Subsequently, interoperability shall be enabled between wallets and bank accounts through UPI and for PPIs issued in the form of cards later on. However, banks may continue to issue PPIs in association with authorised card networks.
Besides, RBI has mentioned that PPI issuers will have to adhere to the technical and operational requirements for such interoperability, including those relating to safety and security, risk mitigation, among others.
Charting out the guidelines in a 32-page note, RBI has said that all the companies seeking a licence to operate wallets will have to have a minimum positive net worth of ₹5 crore which needs to be maintained for three years at all times, following which they need to have a net worth of ₹15 crore at all times. Existing wallet companies need to maintain ₹15 crore by March 31, 2020.
On the capital requirement, RBI said that wallets such as Paytm and Mobikwik need to have a minimum net worth of ₹25 crore from the earlier norms of ₹5 crore paid-up capital and ₹1 crore net worth.
It said all the semi-closed PPIs should be upgraded to full KYC norms with 12 months from the date of issue of PPI. The minimum details for KYC shall include OTP verified mobile number and self-declaration of name, address, gender, date of birth and unique identification number of any of the ‘officially valid document’. For existing wallets, companies need to ensure that they will have full KYC by the end of the December 31. Following which, these wallets will cease to exist.
PPIs limit at Rs 50,000 a month
PTI reports: Prepaid payment instruments cannot be loaded with more than Rs 50,000 per month and the issuers cannot pay interest on the PPI balances, the Reserve Bank said today.
“All entities approved/authorised to issue PPIs by RBI are permitted to issue re—loadable or non—reloadable PPIs depending upon the permissible type.
“Cash loading to PPIs shall be limited to Rs 50,000/— per month subject to overall limit of the PPI,” the RBI said in its latest set of directions on ‘Issuance and Operation of Prepaid Payment Instruments’
The Reserve Bank has asked the PPI issuers to ensure that no interest is paid on the PPI balances.
PPIs that can be issued as cards, wallets or any such form can be loaded or reloaded by cash, by debit to a bank account, by credit or by debit card among others. These instruments are basically promoted by the RBI to make electronic payments popular, efficient and more secure.
Also, companies will no longer be allowed to issue such instruments in the paper form except for meal vouchers.
However, these vouchers will have to be replaced in electronic format after December 31, 2017, the RBI added.
For increasing the limit of PPIs to up to Rs 1 lakh, the issuers will have to do a KYC check of the instrument holder.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.