Guides

Overview: About KYC

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The Know your customer (KYC) process is critical to the user journey. It establishes the legitimacy of a user’s identity for the issuer, in compliance with RBI guidelines. KYC helps prevent identity theft, money laundering, financial fraud, terrorism financing, and other financial crimes.

Prepaid Payment Instruments (PPIs) and RBI Master Direction KYC Guidelines: Instruments that facilitate the purchase of goods and services, financial services, remittance facilities, etc., against the value stored therein. PPIs that require RBI approval/authorisation prior to issuance are classified under two types viz. (i) Small PPIs, and (ii) Full-KYC PPIs.

Small PPIs

Issued by banks and non-banks after obtaining minimum details of the PPI holder.

  1. Allowed to be used only for the purchase of goods and services
  2. Fund transfer or cash withdrawal from such PPIs shall not be permitted
  3. Small PPIs can be used at a group of clearly identified merchant locations/establishments which have a specific contract with the issuer (or contract through a payment aggregator/payment gateway) to accept the PPIs as payment instruments

Key Features and limits

  1. Bank and non-banks shall be permitted to issue such PPIs after obtaining minimum details of the PPI holder
  2. Minimum details shall necessarily include a mobile number verified with One Time Password (OTP) and a self-declaration of name and unique identity/identification number of any ‘mandatory document’ or ‘Officially Valid Document (OVD)’ ID.
  3. Such PPIs shall be reloadable in nature
  4. Amount loaded in such PPIs during any month shall not exceed Rs.10,000/- and the total amount loaded during the financial year shall not exceed Rs.1,20,000/-
  5. Amount outstanding and Total amount debited at any point of time in such PPIs shall not exceed Rs.10,000/-

Full-KYC PPIs

Issued by banks and non-banks after completing the Know Your Customer (KYC) of the PPI holder.

  1. Allowed to be used for the purchase of goods and services
  2. Funds transfer or cash withdrawal shall be permitted

Key Features and limits

Banks and non-banks shall be permitted to issue such PPIs after completing the KYC of the PPI holder

  1. The Video-based Customer Identification Process (V-CIP) can be used to open full-KYC PPIs as well as to convert Small PPIs into full-KYC PPIs
  2. Such PPIs shall be reloadable in nature
  3. The amount outstanding shall not exceed Rs.2,00,000/- at any point in time
    The funds can be transferred ‘back to source account’ or ‘own bank account of the PPI holder’. Withdrawal of funds is allowed by using the following methods
    1. ATM
    2. MicroATMs/Cash at POS
    3. IMPS/UPI to a bank account
  4. Funds transfer shall be permitted with predefined limits

Updated almost 2 years ago