New prepaid card for transactions up to Rs 10,000

Mumbai: The Reserve Bank on Thursday proposed to introduce a prepaid payment instrument (PPI) that could be used only for transactions of goods and services worth up to Rs 10,000.

PPIs have been playing an important role in promoting digital payments and bringing in the new PPI will further facilitate its usage, as per an RBI statement issued post announcement of the monetary review on Thursday.

"To further facilitate its (PPI) usage, it is proposed to introduce a new type of PPI which can be used only for purchase of goods and services up to a limit of Rs 10,000," the statement said.

The central bank said the loading and reloading of such PPIs can be done only from a bank account and used for making bill payments and merchant payments. Such PPIs can be issued on the basis of essential minimum details sourced from the customer.

The RBI said it will give instructions in this regard by December 31, 2019. PPIs are instruments to facilitate purchase of goods and services, including financial services, remittance facilities among others against the value stored on such instruments.