Policy Guidelines on Pre-paid Payment Instruments in India
The Reserve Bank of India (RBI) has issued a master circular outlining policy guidelines for the issuance and operation of pre-paid payment instruments in India.
The guidelines aim to provide a framework for the issuance and operation of pre-paid payment instruments, ensuring their safe and efficient use.
Eligibility and Exemptions: Entities eligible to issue pre-paid payment instruments include banks, non-banking financial companies (NBFCs), and other persons. Foreign exchange pre-paid payment instruments are exempt from certain requirements.
Capital Requirements: Issuers must meet minimum capital requirements to ensure the safety and soundness of their operations.
Safeguards against Money Laundering: Issuers must implement Know-Your-Customer (KYC), Anti-Money Laundering (AML), and Combating the Financing of Terrorism (CFT) provisions to prevent money laundering and terrorist financing.
Categories of Pre-paid Payment Instruments: The guidelines categorize pre-paid payment instruments into closed, semi-closed, and open systems, with specific requirements for each category.
Co-branded and Specialized Instruments: The guidelines provide for co-branded pre-paid payment instruments, prepaid gift instruments, and instruments issued by banks to government organizations and other entities for specific purposes.
Chat with the Master Circular: