7. Issuance, loading and reloading of PPIs
7.1 All entities approved / authorised to issue PPIs by RBI are permitted to issue reloadable or non-reloadable PPIs depending upon
the permissible type / category of PPIs as laid down in paragraph 9 and 10 of these Directions.
7.2 PPI issuers shall have a clear laid down policy, duly approved by their
Board, for issuance of various types / categories of PPIs and all activities related thereto.
7.3 PPI issuers shall ensure that the name of the company which has received approval / authorisation for issuance and operating of PPIs, is prominently displayed along
with the PPI brand name in all instances. The authorised entities shall also regularly keep RBI informed regarding the brand
names employed / to be employed for their products.
7.4 PPI issuers shall ensure that no interest is payable on PPI balances.
7.5 PPIs shall be permitted to be loaded / reloaded by cash, by debit to a bank account, by credit and debit cards, and other PPIs (as permitted from time to time).
The electronic loading / reloading of PPIs shall be through above payment instruments issued only by regulated entities in India and shall be in INR only.
7.6 Cash loading to PPIs shall be limited to Rs.50,000/- per month subject to overall limit of the PPI.
7.7 The PPIs may 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 shall no longer be issued from the date of this Master Direction except for Meal Paper Vouchers where separate timeline has been indicated.
7.8 Banks shall be permitted to issue and reload PPIs at their branches, ATMs and through their BCs appointed as per the guidelines issued by
RBI in this regard.
7.9 Banks and non-banks shall be permitted to issue and reload such payment instruments through their authorised outlets or through their
authorised / designated agents subject to following conditions:-
a) There shall be a Board approved policy clearly laying down the framework for engaging agents for the purpose of issuance and
reloading of PPIs.
b) Issuers shall carry out proper due diligence of the persons appointed as authorised /designated agents for issue / reloading of permissible
categories of PPIs.
c) Issuers shall be responsible for all the PPIs issued by the authorised / designated agents.
d) Issuers shall be responsible as the principal
for all acts of omission or commission of their authorised / designated agents, including safety and security aspects.
e) Issuers shall ensure preservation of
records and confidentiality of customer information in their possession as well as in the possession of their authorised / designated agents.
f) The PPI issuers
shall regularly monitor the activities of their authorised / designated agents and also carry out a review of the performance of various agents engaged by them at least once
in a year.
g) Issuers and their authorised / designated agents shall ensure adherence to applicable laws of the land, including KYC / AML / CFT norms as
indicated in paragraph 6.
7.10 PPI issuers shall ensure that there is no co-mingling of funds originating from any other activity that the Issuer may be undertaking such as BCs of bank/s,
intermediary for payment aggregation, payment gateway facility, etc.
7.11 PPIs under co-branding arrangements:
a) The co-branding arrangement shall be as per the Board approved policy of the PPI issuer. The policy shall specifically address issues pertaining to the
various risks associated with such an arrangement including reputation risk and the PPI issuer shall put in place suitable risk mitigation measures. The policy shall
also clearly lay down the roles, responsibilities and obligations of each co-branding partner.
b) The co-branding partner shall be a company incorporated in India and registered under the Companies Act 1956 / Companies Act 2013. In case the co-branding
partner is a bank, then the same shall be a bank licensed by RBI.
c) PPI issuers shall carry out due diligence in respect of the co-branding partner to protect
themselves against the reputation risk they are exposed to in such an arrangement. In case of proposed tie up with a financial entity, they may ensure that
that entity has the approval of its regulator for entering into such arrangement.
d) The instructions / guidelines on KYC / AML / CFT (as indicated in paragraph
6) shall be adhered to, in respect of all PPIs issued under the co-branding arrangement as well.
e) The PPI issuer shall be liable for all acts of the co-branding
partner. The Issuers shall also be responsible for all customer related aspects of the PPIs.
f) PPI issuers shall be permitted to co-brand such instruments with
the name / logo of the company for whose customers / beneficiaries such co-branded instruments are to be issued.
g) The name of PPI issuer shall be prominently
visible on the payment instrument.
h) In case of non-bank PPI issuers, where co-branding arrangements take place between two non-bank PPI issuers,
the agreement shall clearly indicate which partner shall be the PPI Issuer.
i) All non-bank PPI issuers desirous of issuing such co-branded PPIs shall seek
one time approval from DPSS, RBI, Central Office. Separate approval is not required for each co-branding arrangement.
j) In case of co-branding arrangements
between bank and non-bank entity, the bank shall be the PPI Issuer. The role of the non-bank entity shall be limited to marketing / distribution of the PPIs or
providing access to the PPI holder to the services that are offered.
k) In case of co-branding arrangement between two banks, then the PPI
issuing bank shall ensure compliance to above instructions
7.12 All PPI issuers already having co-branding arrangements at the time of issuance of this
Master Direction shall review their existing arrangements to meet the above requirements on or before December 31, 2017. The details of all the existing co-branding
arrangements by all PPI issuers shall be reported to DPSS, RBI, Central Office, Mumbai within one month of release of this Master Direction in the format
enclosed (Annex-4). Further, any new arrangement shall also be reported to RBI within seven days
of finalisation of arrangement.
7.13
Prepaid meal instruments: Banks and non-bank entities issuing PPIs in the form of prepaid meal instruments, shall ensure that these are issued only as semi-closed PPIs,
are in electronic form and reloadable. No cash withdrawal or funds transfer shall be permitted from such instruments. Such PPIs need not be issued as a separate category of PPI.
No prepaid meal instruments in paper voucher form shall be issued after December 31, 2017.
7.14 There shall be no remittance without compliance to KYC requirements.
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.