March 28, 2014
All Prepaid Payment Instrument Issuers, System Providers, System Participants
and all other Prospective Prepaid Payment Instrument Issuers
Madam / Dear Sir
Issuance and Operation of Pre-paid Payment Instruments in India – Consolidated Revised Policy Guidelines
To regulate the issue and operation of Pre-paid Payment Instruments, in exercise of the powers conferred under Section 18 of the Payment and Settlement Systems Act, 2007 (Act 51 of 2007) Reserve Bank of India had laid out the guidelines for issuance of prepaid instruments by banks and non-banks entities vide circular DPSS.CO.PD.No.1873/02.14.06/2008-09 dated April 27, 2009. The instructions have been revised from time to time since then. The developments in the pre-paid payment instrument segment had necessitated a comprehensive review of guidelines issued so far. It was also desirable that all instructions on pre-paid payment instruments are made available at one place. Accordingly, the guidelines have been revised and consolidated in consultation with stake holders. The changes being introduced are given in Annex.
2. This Circular, issued under Section 10(2) of the Payment and Settlement Systems Act, 2007 (Act 51 of 2007) contains guidelines on the general type of pre-paid payment instruments that can be issued by banks and non-bank entities, as well as guidelines on specific types of pre-paid payment instruments that have been permitted for issuance, such as, co-branded cards, pre-paid gift instruments, pre-paid instruments issued by banks to government organisations / financial institutions / corporate for specific purposes, as well as pre-paid instruments issued by banks for crediting cross border inward remittances.
3. Reference is also made to our guidelines on Domestic Money Transfer-Relaxations issued vide our circular RBI/2011-12/213 DPSS.PD.CO.No.62/02.27.019/2011-2012 dated October 05, 2011 where relevant.
4. This Circular supersedes all the earlier circulars issued on the subject.
Chief General Manager