Issuance and Operation of pre-paid payment instruments in India- Clarification

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Published on March 23, 2011

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Issuance and Operation of pre-paid payment instruments in India- Clarification

RBI/2010-2011/444
DPSS No. 2174/02.14.004/2010-2011

March 23, 2011

All System Providers, System Participants
and any prospective prepaid payment instrument Issuer.

Madam/Dear Sir

Issuance and Operation of pre-paid payment instruments in India- Clarification

We invite your attention to the directions issued by RBI vide RBI/2010-11/389 DBOD.AML.No. 77/14.01.001/2010-11 dated January 27, 2011 on the basis of a notification issued by the Government of India, (No. 14/2010/ F.No.6/2/2007-E.S. dated December 16, 2010), amending the Prevention of Money-laundering (Maintenance of Records of the Nature and Value of Transactions, the Procedure and Manner of Maintaining and Time for Furnishing Information and Verification and Maintenance of Records of the Identity of the Clients of the Banking Companies, Financial Institutions and Intermediaries) Rules, 2005.

2. As per the notification an amendment has been made to Para 2 (d) of the PML Rules 2005 to incorporate the job card issued by NREGA duly signed by an officer of the State Government, and the letter issued by the Unique Identification Authority of India containing details of name, address and Aadhaar number as officially valid documents for identity.

3. Para 6.4 (ii) of the guidelines on prepaid instruments issued by RBI on April 27, 2009 permits issue of semi-closed prepaid cards upto Rs 5000/- wherein customer due diligence can be carried out by accepting any officially valid document as defined under Rule 2(d) of the PMLA Rules 2005. Hence job card issued by NREGA duly signed by an officer of the State Government, and the letter issued by the Unique Identification Authority of India containing details of name, address and Aadhaar number as quoted under Para 2 (d) of PML Rules 2005 can be considered by the issuer as officially valid document for identity while issuing such cards..

4. It may be noted that system providers shall continue to carry out full KYC as per KYC/AML/PML guidelines mandated in terms of other provisions of the guidelines.

5. Please acknowledge receipt.

Yours faithfully,

(K Sivaraman)
General Manager