RBI extends deadline for completion of KYC process for Prepaid Payment Instruments by 6 months

Mumbai: The Reserve Bank of India (RBI) today extended the deadline for completion of KYC process for the Prepaid Payment Instruments (PPIs) users for another six months.

“RBI had issued Master Direction on Issuance and Operation of Prepaid Payment Instruments (PPIs) on October 11, 2017 (amended as on December 29, 2017).  As per these directions, PPI issuers are required to complete the Know Your Customer (KYC) process by February 28, 2019. Based on requests received from various stakeholders to increase the above timeline on account of difficulties in undertaking Aadhaar e-KYC and time necessary to put in place alternative systems for completing the KYC process, it has been decided to allow PPI issuers additional time of six months for completion of the KYC process. The relevant provision in the PPI Master Direction has been modified suitably” a RBI release said.

What is PPI ?

Prepaid payment instruments (PPIs) come with a pre-loaded value and in some cases a pre-defined purpose of payment. The value stored on PPIs represents the value paid by the holders by cash through a bank account etc. There are large variety of PPIs including smart cards, magnetic stripe cards, internet accounts, internet wallets or digital wallets, mobile accounts, mobile wallets, paper vouchers and any such instrument which can be used to access the pre-paid amount. These payment instruments are licensed and regulated by the RBI. There are three types of PPIs—closed system PPIs, semi-closed system PPIs and open system PPIs.