RBI

Special measures to incentivise Electronic Payments-Enhancement in issuance limits for PPIs, Special measures for merchants

Special measures to incentivise Electronic Payments-Enhancement in issuance limits for Pre-Paid Payment Instruments (PPIs), Special measures for merchants

Reserve Bank of India

Special measures to incentivise Electronic Payments – (i) Enhancement in issuance limits for Pre-Paid Payment Instruments (PPIs) in India (ii) Special measures for merchants

RBI/2016-17/150
DPSS.CO.PD.No.1288/02.14.006/2016-17

November 22, 2016

All Prepaid Payment Instrument Issuers,
System Providers, System Participants
and all other Prospective Prepaid Payment Instrument Issuers

Dear Madam / Sir,

Special measures to incentivise Electronic Payments –
(i) Enhancement in issuance limits for Pre-Paid Payment Instruments (PPIs) in India
(ii) Special measures for merchants

Following the withdrawal of legal tender characteristics of existing ₹ 500/- and ₹ 1000/- Bank Notes (Specified Bank Notes – SBN), in order to facilitate the adoption of digital payments, it has been considered necessary to introduce the following special measures in partial modification of Master Circular DPSS.CO.PD.PPI.No.01/02.14.006/2016-17 dated July 01, 2016 on Issuance and Operation of Pre-paid Payment Instruments in India.

(i) Enhancement in PPI limits:

  1. The limit of semi-closed Prepaid Payment Instrument (PPI) that can be issued under Para 7.2 (i) of the Master Circular on issuance and operations of PPIs in India has now been enhanced from ₹ 10,000/- to ₹ 20,000/- .
  2. The total value of reloads during any given month shall also not exceed ₹ 20,000/-
  3. All other extant instructions in this regard shall remain unchanged.

(ii) Special dispensation for merchants:

As per the extant PPI guidelines, merchants are defined as establishments who accept the PPIs issued by PPI issuer against the sale of goods and services. As a special dispensation for small merchants, PPI issuers can now issue PPIs to such merchants subject to the following:

  1. Merchants shall give a self-declaration in respect of their merchant status and details of their own bank account, which shall be kept on record by the issuer.
  2. PPIs can be issued to such willing merchants only after due verification and validation of their bank account details.
  3. Inflows of funds / credit to such PPIs shall emanate only from sale transactions of the merchant.
  4. While there is no minimum balance requirement, the maximum value in these PPIs shall not exceed ₹ 20,000/- at any point of time.
  5. Funds transfer from such PPIs are permitted only to the merchant’s own linked bank account and upto an amount of ₹ 50,000/- per month, without any limit per transaction.
  6. PPI issuers shall clearly identify such PPIs in their systems for the purpose of maintenance of escrow, reporting and MIS requirements.

2. The above measures shall come into effect from the date of this circular and shall be applicable till December 30, 2016, subject to review.

3. The directive is issued under Section 10(2) read with Section 18 of Payment and Settlement Systems Act 2007, (Act 51 of 2007).

Yours faithfully

(Nanda S Dave)
Chief General Manager

Share

Recent Posts

  • Income Tax

Appeal withdrawn against rejection u/s 12AB as assessee was availing benefit u/s 10(23C)(iiiad)

ITAT allows withdrawal of appeal against rejection of registration u/s 12AB as assessee had been availing benefit of blanket exemption…

13 hours ago
  • Income Tax

When delay not mala fide, right of hearing on merit not to be rejected – ITAT

When explanation for delay does not smack of mala fide, right of hearing of appeal on merit ought not to…

15 hours ago
  • Income Tax

Exemption u/s 54 allowed despite failure to deposit in Capital Gains Accounts Scheme

ITAT allows exemption u/s 54 allowed despite failure to deposit the amount in Capital Gains Accounts Scheme and new asset…

2 days ago
  • Income Tax

No addition to be made in hands of assessee solely on basis of uncorroborated loose-sheet

Addition cannot be made in the hands of the assessee solely on the basis of uncorroborated loose-sheet - ITAT In…

2 days ago
  • Income Tax

Claim of Leave Encashment exemption u/s 10(10AA)(ii) dismissed beyond Rs. 3 lakhs

ITAT dismisses claim of Leave Encashment exemption u/s 10(10AA)(ii) beyond Rs. 3 lakhs In a recent judgment, ITAT Ahmedabad has…

2 days ago
  • Income Tax

AO took a reasonable stand that 25 kg written in WhatsApp chat was 25 lakh – ITAT

Assessing Officer had taken a reasonable stand that 25 kg written in WhatsApp chat/text message was 25 lakh - ITAT…

3 days ago