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Cash Withdrawal Facility at Point of Sale (PoS) Terminals

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1. Which types of cards are allowed for withdrawing cash at PoS terminals? +

Ans. Under the facility of cash withdrawal at PoS terminals, cardholders can withdraw cash using their debit cards and full KYC prepaid cards issued by banks and non-banks in India. However, credit cards cannot be used under this facility. Cash can also be withdrawn at PoS terminals through Unified Payments Interface (UPI) as well as through use of electronic cards that are linked with overdraft facility provided along with Pradhan Mantri Jan Dhan Yojana (PMJDY) accounts.

Q1: The MD-TLE has various clauses incorporating the term ‘time of transfer’. What is to be taken as the ‘time of transfer’?

Ans: It is clarified that ‘time of transfer’ would mean when the associated risks and rewards, to the extent of economic interest transferred and as documented in the loan participation, assignment or novation contract, becomes binding on the transferor and transferee.

1. What are the RBI guidelines on education loans?

RBI issued circular RPCD.PLNFS.BC.NO.83/06.12.05/2000-01 dated April 28, 2001 on ‘Educational Loan Scheme’ advising all Scheduled Commercial Banks to adopt the Model Education Loan Scheme, formulated by Indian Banks’ Association (IBA). The Scheme has been revised by IBA from time to time and its latest revision is Model Education Loan Scheme (MELS), 2021.

For detailed information on guidelines to banks on education loan, please refer to MELS, 2021 and its related circulars. Copy of the aforesaid Scheme is available on the IBA website.

It is to be noted that the MELS, 2021 provides broad guidelines to the banks for operationalizing the educational loan scheme and implementing banks will have the discretion to make changes as deemed fit.

(i) If a borrower has aggregate sanctioned credit limit of Rs.25,000 crore on or before March 31, 2016, will it still qualify as a ‘Specified Borrower’? +

In all such cases, the borrower will deemed to be a ‘Specified borrower’ from April 1, 2016 and the disincentive mechanism will be applicable from April 1, 2017 if the borrower borrows from the banking system beyond the NPLL.

Q 1: Whether a lending transaction would fall under the definition of digital lending only if all the processes in the life cycle of a loan, viz., customer acquisition, credit assessment, loan approval, disbursement, recovery, and associated customer service, are carried out digitally or some of the aforesaid processes can be carried out in physical mode also? +

Ans: The phrase ‘largely by use of seamless digital technologies’ has been used in the Digital Lending definition to accord operational flexibility to REs in ‘Digital Lending’. Therefore, even if some physical interface with customer is present, the lending will still fall under the definition of Digital Lending. However, while doing so, the REs should ensure that the intent behind the Guidelines is adhered to.

(Reference Circular: DoR.MCS.REC.28/01.01.001/2023-24 dated August 18, 2023 and DoR.MCS.REC.61/01.01.001/2023-24 dated December 29, 2023)

1. Para 3(viii) of the circular specifies that in the case of existing loans, the switchover to new penal charges regime shall be ensured on next review or renewal date or six months from the effective date of the circular, whichever is earlier. Whether such date of next review or renewal can be counted only after the effective date or even before the effective date if the accounts are subjected to review/ renewal?

In case of existing loans as well, the instructions shall come into effect from April 1, 2024 and the switchover to new penal charges regime shall be ensured on the next review / renewal date falling on or after April 1, 2024, but not later than June 30, 2024.

Frequently Asked Questions (FAQs) on circular dated September 25, 2023 on ‘Display of information - Secured assets possessed under the SARFAESI Act, 2002’

1. Does the circular cover display of assets possessed before the circular date?

Ans: Secured assets possessed by Regulated Entities (REs) under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 on or after the date of the circular should be disclosed on their website.

Circular dated April 11, 2023 on ‘Framework for acceptance of Green Deposits’

1. Is it mandatory for the regulated entities (REs) to raise green deposits?

It is not mandatory but in case REs intend to raise green deposits from their customers they should follow the framework prescribed therein.

1. What are various types of cards? +

Ans: Cards can be classified on the basis of their issuance, usage and payment by the card holder. There are three types of cards (a) debit, (b) credit, and (c) prepaid.

1. What is the ATS ? +

The ATS is an Application Tracking System, hosted on the public website of the Reserve Bank of India (RBI), which has been developed for members of the public to submit any individual application to RBI and keep track of the status of its disposal thereafter.