The Reserve Bank of India has allowed authorised bank and non-bank Prepaid Payment Instruments (PPIs) to issue PPIs for making payments across various public transport systems to provide convenience, speed, affordability, and safety of digital modes of payment to commuters for transit services.
Also read: RBI in favour of TPAP licence for Paytm, asks NPCI to transfer UPI handles to other banks
Issuers will now be able to issue such PPIs for Mass Transit Systems (PPI-MTS) to make payments across various modes of public transport such as metro, buses, rail, and waterways, tolls and parking, effective immediately.
“PPIs shall contain the Automated Fare Collection application related to transit services, toll collection and parking,” the central bank said, adding that these PPIs can be issued without KYC verification of the holders.
While the PPI accounts may be “reloadable in nature”, the amount outstanding cannot exceed ₹3,000 at any time and no cash withdrawal, refund or funds transfer will be permitted. Further, these PPIs will have perpetual validity, as per the amended master circular on PPIs.
Industry body, Payments Council of India (PCI) said that this aligns with the broader vision of advancing digital payments infrastructure and fostering inclusive growth in India’s financial landscape.
Also read: RBI allows banks and NBFCs to issue prepaid instruments for public transport payments
“This marks a pivotal moment in our journey towards modernizing transit systems. By embracing digital payment solutions, we not only enhance convenience but also pave the way for a more efficient, accessible, and forward-looking transportation experience for all,” said Bipin Preet Singh, Co-Founder & CEO of MobiKwik and Co-Chair, PPI Committee, Payments Council of India.