Ans. The framework to limit the liability of customers (PPI holders) against unauthorised transactions in PPIs issued by non-bank issuers is given in paragraph 17 of the MD-PPIs and has come into effect from March 01, 2019. The FAQs given below relate to PPIs issued by non-bank PPI issuers.

Yes, the overseas branches of the banks can make donations abroad, provided the banks do not exceed the prescribed ceiling of one per cent of their published profit of the previous year.

A. Promoter Group for the purpose of these guidelines will be as per the definition given in Annex I to the guidelines.

Ans. Except for the PPIs issued under the arrangement of PPI-MTS as per paragraph 10.2 of MD-PPIs, the framework is applicable to all PPIs issued by authorised non-bank PPI issuers. Even in PPI-MTS, the cases of contributory fraud / negligence / deficiency on the part of the issuer are covered.

i) Boards of Directors of the banks should lay down policy and formulate detailed operational guidelines separately in respect of metropolitan, urban, semi-urban and rural areas covering all areas in respect of acquiring premises on lease/rental basis for the bank's use including delegation of powers at various levels. The decision of surrender or shifting of premises other than at rural centres is taken at central office level by a committee of senior executives. ii) Banks' Boards should lay down a separate policy in respect of loans granted to landlords who provide to them premises on lease/rental basis. The rate of interest to be charged on such loans should be fixed as per the lending rate directives issued by RBI with minimum PLR for the loans above Rs. 2 lakhs. The rate of interest may be simple rate or compound rate as per the usual practice of the bank as applicable to other term loans. iii) Banks should evolve a suitable machinery for dealing with genuine grievances of the landlord for expeditious disposal. iv) In case of negotiated contracts in respect of advances to landlords and rental (including taxes etc. and deposits of Rs.25 lakhs and above) in respect of premises taken on lease/rental basis by public sector banks, the cases will be reported to Central Bureau of Investigation as per the extant Government instructions. This requirement is not applicable to banks in the private sector.

A. Merely holding 10 per cent of the free float in the listed CIC would not make the investor a Promoter. If the investor does not form a part of the Promoters/Promoter Group as per the definition given in Annex I to the guidelines, he would not be considered as a Promoter.

The banks have been given the freedom to determine the service charges to be levied from their customers and the RBI has not prescribed any ceilings in this regard.

Ans. For the purpose of this MD, electronic payment transactions can be–

1. Remote / Online payment transactions: Transactions that do not require physical PPIs to be presented at the point of transactions e.g. wallets, card not present (CNP) transaction, etc.; and

2. Face-to-face / Proximity payment transactions: Transactions that require physical PPIs to be present at the point of transactions e.g. transactions at ATMs, PoS devices, etc.).

A. It is essential that clause (b) of para 2(C)(ii) (i.e. not less than 51 per cent of the voting equity shares of the NOFHC to be held by companies in which the public hold not less than 51 per cent of the voting equity shares) is satisfied in all cases, whereas clause (a) of para 2(C) (ii) does not stipulate any minimum shareholding. Accordingly, it is not necessary that an individual, along with his relatives (as defined in Section 6 of the Companies Act, 1956) and along with entities in which he and/or his relatives hold not less than 50 per cent of the voting equity shares should hold shares in the NOFHC. [para 2 (C) (ii) of the guidelines]

Ans. In order to get protection under this framework, it is mandatory for the customer (PPI holder) to register for SMS alerts.

A. Yes. It would be possible for an individual belonging to the Promoter Group, along with his relatives (as defined in Section 6 of the Companies Act, 1956) and along with entities in which he and/or his relatives hold not less than 50 per cent of voting equity shares, to have significant holdings in other Promoter Group companies in which the public holds not less than 51 per cent of voting equity shares.

Ans. It is mandatory for non-bank PPI issuers to send an SMS alert to the customer for any payment transaction in his / her account. In addition, an e-mail alert may also be sent, wherever registered. The transaction alert should have a contact number and / or e-mail id on which the customer can report unauthorised transactions or notify the objection.

A company in which public holds 51 per cent need not necessarily be listed. For the purpose of these guidelines, ‘public shareholding’ implies that no person along with his relatives (as defined in Section 6 of the Companies Act, 1956) and entities in which he and / or his relatives hold not less than 50 per cent of the voting equity shares, by virtue of his shareholding or otherwise, exercises ‘significant influence’ or ‘control’ (as defined in Accounting Standard 23) over the company.[para 2 (C) (ii) of the guidelines]

Ans. Non-bank PPI issuers shall provide customers with 24x7 access via website / SMS / e-mail / dedicated toll-free helpline for reporting unauthorised transactions and / or loss or theft of the PPI. Further, a direct link for lodging of complaints, with specific option to report unauthorised electronic payment transactions shall be provided by non-bank PPI issuers on the mobile app / home page of their website / any other evolving acceptance mode.

A company in which public holds 51 per cent need not necessarily be listed. For the purpose of these guidelines, ‘public shareholding’ implies that no person along with his relatives (as defined in Section 6 of the Companies Act, 1956) and entities in which he and / or his relatives hold not less than 50 per cent of the voting equity shares, by virtue of his shareholding or otherwise, exercises ‘significant influence’ or ‘control’ (as defined in Accounting Standard 23) over the company.[para 2 (C) (ii) of the guidelines]

Ans. On reporting of an unauthorised payment transaction or loss of instrument, non-bank PPI issuers shall take immediate action to prevent further unauthorised payment transactions in the PPI account of the customer. Any further transactions debit on such an instrument will be the liability of the issuer.

Yes, to the extent permissible under the relevant laws. However, it will not be reckoned for the purpose of calculation of promoter shareholding in the NOFHC.

Ans. The liability of a customer in cases of contributory fraud / negligence / deficiency on the part of the non-bank PPI issuer is zero. PPI-MTS issuers are also covered for such acts / events.

Yes, to the extent permissible under the relevant laws. However, it will not be reckoned for the purpose of calculation of promoter shareholding in the NOFHC.

Ans. It is always advisable to report any unauthorised transaction in the account of the customer. However, an issuer cannot deny compensation against contributory fraud / negligence / deficiency on the part of the non-bank PPI issuer, on the ground that the customer has not reported any unauthorised transaction in his / her account.