Banking News

Issuance and Operations of Prepaid Payment Instruments

Issuance and Operations of Prepaid Payment Instruments

In terms of the latest amendment to master circular of RBI, the  Banks which extend the Prepaid Payment Instruments facility the other entities / ‘employers’ such as unlisted corporates /partnership firms / sole proprietorship / public organizations like municipal corporations, urban local bodies, etc. The above-mentioned employers utilize prepaid payment instruments for onward issuance to their staff /employees/contract workers, etc.

The entities / ‘employers’ that have a bank account with the banks may be extended with the facility after obtaining an undertaking that they are not availing of this facility from any other bank. The verification of the identity of the staff/ employees /contract workers etc. shall be the responsibility of the concerned ‘employer’.

The banks who extend the service to Prepaid Payment Instruments required to put in place the proper systems to capture and maintain details of the employees to whom the cards are issued by the ‘employer’ along with copies of photograph and identity proof of such employees. The ‘employer’ is also required to make available details of bank accounts (if any) of the employees to the bank.    Banks shall load/reload PPIs after obtaining necessary authorisation and above-mentioned details of the employees/staff/contract workers, etc. from the ‘employers’.

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