Whalesbook
Regulatory Capital Requirements
Non-bank entities seeking to operate as payment system providers face significantly higher capital infusion mandates. Entry-level authorization will now require a minimum net worth of ₹5 crore. This figure must scale up to ₹15 crore within three years of receiving authorization, signaling a push for greater financial stability among digital payment operators.
Transaction and Balance Limits
The updated framework imposes tighter caps on balances and transactions for prepaid payment instruments (PPIs). Full-KYC compliant PPIs can maintain an outstanding balance of up to ₹2 lakh, with a corresponding monthly debit limit. Peer-to-peer fund transfers are capped at ₹25,000 per month. Cash loading into PPIs is also restricted to ₹10,000 per transaction.
Small PPI Restrictions
Small PPIs, which require minimal KYC, remain under strict control. These instruments will continue to have a balance cap of ₹10,000. Crucially, they will not offer any provision for fund transfers or withdrawals, limiting their utility to basic transaction purposes.
Interoperability and Usage
A significant stride towards enhanced usability is the mandatory interoperability for full-KYC PPIs. This will be facilitated through established card networks or the Unified Payments Interface (UPI). The RBI's objective is to allow seamless transactions across different platforms, improving the overall user experience. However, cross-border usage of PPIs has not been permitted under these revised norms.
Customer Protection Measures
Customer safeguards are reinforced, requiring issuers to provide clear, upfront disclosure of all charges and terms and conditions. A robust grievance redressal mechanism must be maintained, and all PPI issuers must adhere to the RBI’s Integrated Ombudsman Scheme. In cases of refunds, the amounts are to be credited immediately to the customer’s PPI, even if it temporarily exceeds established balance limits.
Operational Safeguards
Operational integrity is addressed through the requirement for non-bank issuers to maintain dedicated escrow accounts. These accounts must be held with scheduled commercial banks and ensure daily reconciliation between balances and outstanding liabilities. Procedures for deactivation are also clarified: PPIs will be deactivated after one year of inactivity and closed if not reactivated within another year, with remaining balances returned to the source account.
This broad update reflects the central bank's aim to build a standardized and secure digital payments system. By improving risk controls and operational strength, the RBI seeks to balance innovation with financial stability in India's fast-growing digital economy.