RBI/2013-14/607 UBD.CO.BPD.PCB.Cir. No. 65/09.69.000/2013-14
Issue of Pre-paid Payment Instruments-UCBs
Please refer to circular UBD (PCB) BPD Cir No.50/09.69.000/2005-06 dated April 28, 2006 permitting Urban Cooperative Banks (UCBs) to install ATMs and issue ATM-cum-Debit Cards.
2. We have been receiving requests from a few UCBs to allow them to undertake Credit / Pre-paid Card business. Taking into account the business profile of UCBs and the nature of risks associated with Credit/ Pre-paid Card business, it has been decided that UCBs which have installed ATMs and issued ATM-cum-Debit Cards may introduce ‘Semi-Closed Pre-paid Payment Instruments’ permitting payment of utility bill/ essential services up to a limit of Rs. 10,000/-. These payment instruments shall be redeemable at a group of clearly identified merchant locations/ establishments which enter into contracts specifically with the UCB to accept the payment instruments. These instruments shall not permit cash withdrawal or redemption by the holder.
3. The issuance and operations of these instruments shall be guided by the instructions contained in circular DPSS.CO.PD.No.1873/ 02.14.06/2008-09 dated April 27, 2009 and any other circular/ instructions issued in this regard from time to time by the Department of Payment and Settlement Systems, Reserve Bank of India.
Yours faithfully,
(P K Arora)
General Manager
General Manager
