Ans. In exercise of the powers conferred under Section 18 read with Section 10(2) of the Payment and Settlement Systems Act, 2007 (PSS Act), RBI has issued these Master Directions.

Ans. The list of PPI issuers is available on the RBI website at the links https://www.rbi.org.in/Scripts/bs_viewcontent.aspx?Id=2491 (bank-PPI issuers) and https://www.rbi.org.in/Scripts/PublicationsView.aspx?id=12043 (non-bank PPI issuers).

Ans. These PPIs are issued by an entity for facilitating the purchase of goods and services from that entity only. Cash withdrawals are not permitted. These instruments cannot be used for payment or settlement for third party services. The issuance or operation of such instruments is not classified as a payment system requiring approval / authorisation by RBI and are, therefore, not regulated or supervised by RBI.

Ans. PPIs that require RBI approval / authorisation prior to issuance are classified under two types:

1. Small PPIs (or minimum-detail PPIs): These PPIs are issued by banks and non-banks after obtaining minimum details of the PPI holder. These PPIs can be used for purchase of goods and services at a group of clearly identified merchant locations / establishments which have a specific contract with the issuer (or contract through a payment aggregator / payment gateway) to accept the PPIs as payment instruments. Funds transfer or cash withdrawal from such PPIs is not permitted.

2. Full-KYC PPIs: The PPIs are issued by banks and non-banks after completing Know Your Customer (KYC) of PPI holder. These PPIs can be used for purchase of goods and services, funds transfer or cash withdrawal.

Ans. Small PPIs can be of two types:

1. PPIs upto ₹10,000/- (with cash loading facility). These PPIs shall be converted into full-KYC PPIs within 24 months.

2. PPIs upto ₹10,000/- (with no cash loading facility).

Ans. Yes, the cash loading of PPIs is limited to ₹ 50,000/- per month subject to overall limit of the PPI (not permitted in one type of Small PPI). The limit on loading of PPIs via electronic / online means is subject to overall limit of the PPI.

Ans. The minimum details in both types of Small PPIs are same and are as under:

1. mobile number verified with One Time Password (OTP); and

2. self-declaration of name and unique identity / identification number of any mandatory document or Officially Valid Document (OVD) or any such document with any name listed for this purpose in the RBI’s Master Direction on KYC. The present list of mandatory document / OVDs include passport, driving licence, voter's identity card, NREGA job card, proof of possession of Aadhaar number and letter issued by the National Population Register.

Ans. Both types of Small PPIs are reloadable and shall be used only for purchase of goods and services. Their salient features are as follows:

PPIs upto ₹10,000/- (with cash loading facility):

1. The amount loaded during any month shall not exceed ₹10,000/-;

2. The total amount loaded during the financial year shall not exceed ₹1,20,000/-;

3. The amount outstanding at any point of time shall not exceed ₹10,000/-;

4. The total amount debited during any given month shall not exceed ₹10,000/-;

5. These PPIs shall be converted into full-KYC PPIs within 24 months; and

6. Loading / Reloading can be by cash or electronic means.

PPIs upto ₹10,000/- (with no cash loading facility):

1. The amount loaded during any month shall not exceed ₹10,000/-;

2. The total amount loaded during the financial year shall not exceed ₹1,20,000/-;

3. The amount outstanding at any point of time shall not exceed ₹10,000/-;

4. Loading / Reloading shall be from a bank account / credit card / full-KYC PPI; and

5. The Small PPIs (with cash loading facility) existing as on December 24, 2019 can be converted to this PPI, if desired by the PPI holder.

Ans. A Small PPI (with cash loading facility) can be held for a maximum period of 24 months only. The 24 months shall be counted from the day of opening such a PPI. Within this period of 24 months, it has to be converted into a full-KYC PPI failing which, no further credit in such PPI shall be allowed. However, the PPI holder shall be allowed to use the available balance.

Ans. The salient features of ‘Full-KYC’ PPIs are as follows:

1. Reloadable in nature;

2. The amount outstanding shall not exceed ₹2,00,000/- at any point of time;

3. There are no limits prescribed for total credits or debits during a month; and

4. They can be used for purchase of goods and services, cash withdrawal and funds transfer.

Ans. PPI issuer is responsible for verifying that the bank account pertains to the PPI holder for which it may devise suitable methods of verification.

Ans. Apart from above PPIs, there are the following two categories of PPIs:

1. Gift PPIs; and

2. PPIs for Mass Transit Systems (PPI-MTS).

Ans. The salient features of Gift PPIs are as follows:

1. Maximum value of each such prepaid gift instrument shall not exceed ₹10,000/-;

2. Are not reloadable;

3. Cash-out or fund transfer is not permitted. However, the funds may be transferred ‘back to source account’ (account from where Gift PPI was loaded) after receiving consent of the PPI holder;

4. Shall be revalidated (including through issuance of new instrument) as and when requested by the PPI holder; and

5. The Additional Factor of Authentication (AFA) / Two Factor Authentication (2FA) for transactions using Gift PPIs is not mandatory.

Ans. The salient features of PPI-MTS are as follows:

1. These PPIs are issued by MTS operators;

2. Apart from the MTS, these PPIs can be used only at merchants whose activities are allied / related to / are carried on within the premises of the transit system;

3. Reloadable in nature;

4. Maximum outstanding cannot exceed ₹3,000/- at any point of time;

5. Cash-out or refund or fund transfer is not permitted;

6. Shall be revalidated (including through issuance of new instrument) as and when requested by the PPI holder; and

7. The AFA / 2FA for transactions using such PPIs is not mandatory.

Ans. The meaning of KYC is as defined in paragraph 6 of the MD-PPIs. The KYC / Anti-Money Laundering (AML) / Combating Financing of Terrorism (CFT) guidelines issued by the Department of Regulation (DoR), RBI, in “Master Direction – Know Your Customer Direction, 2016”, shall apply mutatis mutandis to all the entities issuing PPIs.

Ans. PPIs can be issued as cards, wallets, and any such form / instrument which can be used to access the PPI and to use the amount therein. PPIs in the form of paper vouchers cannot be issued.

Ans. PPI issuers shall disclose all important terms and conditions in clear and simple language to the holders while issuing the instruments. These disclosures shall include:

1. All charges and fees associated with the use of the instrument; and

2. The expiry period and terms and conditions pertaining to expiration of the instrument.

Ans. PPI issuers, including their agents, shall not create new PPIs each time, for facilitating cash-based remittances to other PPIs / bank accounts. PPIs created for previous remittance by the same person shall be used.

Ans. Full-KYC PPIs issued by Authorised Dealer Category-I banks, can be used in cross-border outward transactions for permissible current account transactions under FEMA viz. purchase of goods and services. This facility shall be enabled only on explicit request of a PPI holder.

Transaction Limits:

1. Per transaction limit shall not exceed ₹10,000/-.

2. Per month limit shall not exceed ₹50,000/-.

Transactions allowed:

Permissible current account transactions under Foreign Exchange Management Act (FEMA) viz. purchase of goods and services, subject to adherence to extant norms governing such transactions.

Transactions not-allowed:

1. Any cross-border outward fund transfer and / or for making remittances under the Liberalised Remittances Scheme.

2. Prefunding of online merchant’s account.

Ans. PPI issuers shall put in place a formal, publicly disclosed customer grievance redressal framework, including designating a nodal officer to handle the customer complaints / grievances, the escalation matrix and turn-around-time for complaint resolution. The framework shall include, at the minimum, the following:

1. Dissemination of the information of customer protection and grievance redressal policy of the PPI issuer in simple language;

2. Clear indication of the customer care contact details of the PPI issuer, including details of nodal official for grievance redressal on website, mobile apps, and cards;

3. Display of proper signage by the agents of the PPI Issuer and the customer care contact details as at (b) above;

4. Providing specific complaint numbers for the complaints lodged along with the facility to track the status of the complaint by the customer;

5. Initiating action to resolve any customer complaint / grievance expeditiously, preferably within 48 hours and endeavour to resolve the same not later than 30 days from the date of receipt of such complaint / grievance;

6. Display the detailed list of the authorised / designated agents (name, agent ID, address, contact details, etc.) of the PPI issuer on the website / mobile app; and

7. Provide answers to Frequently Asked Questions (FAQs) on the website / mobile app related to the PPIs.

Ans. PPI issuers shall provide an option for the PPI holders to generate / receive account statements for at least past 6 months. The account statement shall, at the minimum, provide details such as date of transaction, debit / credit amount, net balance and description of transaction. Additionally, the PPI issuers shall provide transaction history for at least 10 transactions.

Ans. In case of PPIs issued by banks and non-banks, customers have recourse to the Reserve Bank - Integrated Ombudsman Scheme, 2021 for grievance redressal. This scheme is available on the RBI website at the link - https://cms.rbi.org.in.

Ans. A PPI issuer can issue any one of the following three types to a customer:

1. Small PPIs upto ₹10,000 (with cash loading facility);

2. Small PPIs upto ₹10,000 (with no cash loading facility); and

3. Full-KYC PPIs.

Ans. Within the types mentioned above, in case a PPI issuer is issuing multiple PPIs to same customer due to various reasons (e.g. multiple co-branding partners, issuance of PPI in different form factors like wallets / cards), then the PPI issuer shall monitor the limits through centralised database / management information system (MIS).

For example, the limit of ₹2,00,000/- at any point of time shall be calculated after combining the value in all full-KYC PPIs issued to a customer by a particular PPI issuer under various arrangements / form factor. Similarly, the limit of ₹10,000 in paragraph 9.1(i) of MD-PPIs is across all Small PPIs (issued by the PPI issuer under various arrangements / form factor). A PPI issuer cannot issue both types of Small PPIs to same mobile number at the same time.

However, the limits do not include the two categories (Gift PPIs and PPI-MTS) mentioned in paragraph 10 of the MD-PPIs.

Ans. Interoperability is the technical compatibility that enables a payment system to be used in conjunction with other payment systems. Interoperability has been allowed in PPIs through circular dated October 16, 2018 and it has been made mandatory vide circular dated May 19, 2021.

Ans. Bank PPI issuers shall be guided by RBI circulars DBR.No.Leg.BC.78/09.07.005/2017-18 dated July 6, 2017 or DCBR.BPD.(PCB/RCB).Cir.No.06/12.05.001/2017-18 dated December 14, 2017, as applicable on Customer Protection – Limiting Liability of Customers in Unauthorised Electronic Banking Transactions.

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.).

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.

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.

Ans. The ‘per transaction customer liability’ in such cases will depend on the number of days lapsed between the receipt of transaction communication by the customer from the non-bank PPI issuer and the reporting of unauthorised transaction by the customer to the non-bank PPI issuer. If the issuer is reported within three days’ of receiving of communication, the customer liability will be zero. Similarly, for any such transaction reported between four and seven days of receiving of communication, the customer liability will be limited to a maximum of ₹ 10,000/. Reporting beyond seven days’ time will be dealt in accordance with the Board approved policy of the non-bank PPI issuer.

Ans. The number of days mentioned above shall be counted after excluding the date of receiving the communication from the non-bank PPI issuer.

Ans. In cases where the loss is due to negligence by the customer, such as where he / she has shared the payment credentials, the customer will bear the entire loss until he / she reports the unauthorised transaction to the non-bank PPI issuer.

Ans. Any loss occurring after reporting of the unauthorised transaction shall be borne by the non-bank PPI issuer.

Ans. The non-bank PPI issuer shall credit (notional reversal / shadow reversal) the amount involved in the unauthorised electronic payment transaction to the customer’s PPI within 10 days from the date of such notification by the customer. Such reversal has to be effected even if it breaches the maximum permissible limit applicable to that type / category of PPI. The credit shall be value-dated to be as of the date of the unauthorised transaction.

Ans. The burden of proving the customer liability in case of unauthorised electronic payment transactions lies on the non-bank PPI issuer.