The Reserve Bank of India (RBI) has introduced a draft Master Direction on Prepaid Payment Instruments (PPIs) to improve security and operational transparency for digital wallets and prepaid cards. This draft allows banks issuing debit cards to provide PPIs after notifying the Department of Payment and Settlement Systems (DPSS). Non-bank applicants are required to have a minimum net worth of Rs 5 crore and submit a certificate from their statutory auditor.
The RBI has requested public feedback on the proposal by May 22, 2026. Additionally, non-bank PPI issuers must achieve a minimum net worth of Rs 15 crore by the end of the third financial year of authorization. The proposal mandates non-bank PPI issuers to maintain the funds collected from PPI issuance in a separate rupee escrow account held with a commercial bank in India.
According to the proposed limits, general purpose PPIs can have an outstanding amount of Rs 2 lakh with a monthly cash-loading cap of Rs 10,000. The draft specifies that the maximum value of such PPIs may be capped at Rs 10,000, and for transit PPIs, it could be capped at Rs 3,000. Loading of these PPIs should be against the receipt of foreign exchange by cash or any payment instrument, with the total monthly debited amount not exceeding Rs 5 lakh.
PPI issuers are required to transparently disclose all features, associated charges, validity period, and terms and conditions to users at the time of issuance, using simple language preferably in English, Hindi, and the local language. Refunds for failed, returned, rejected, or canceled transactions must be promptly applied to the respective PPI, even if such refunds may surpass the prescribed limits for that specific PPI category.
