The Reserve Bank puts new restrictions

The Reserve Bank has released new issues regarding all the pre-paid payment instruments including smart cards, mobile purse and paper vouchers. According to new regulations all the financial institutions now will be obliged to ask permission from the RBI to issue some payment instruments. But not all the institutions will be restricted. So, the companies which issue payment instruments used by business establishments for use at that establishment only or for availing services from a service provider will not be included under the purview of the guidelines.


For avoiding the misuse of instruments like those used for purchase of goods etc (open system payment instrument) and semi-open syetem payment instruments, know-your-customers norm, anti-money laundering rules will be applicable to them.  

Morever, instruments redeemable at a group of establishments associated with a particluar shopping mall, tourist resorts etc can be issued for up to Rs 500 without any KYC, the RBI said. 

"These cards which include gift cards and travel cards, would be subjected to higher safeguards," the RBI said.