The Reserve Bank of India has just announced that only corporations listed in India can purchase prepaid instruments such as smart cards, magnetic stripe cards, and mobile wallets.
In a circular issued to all banks, the RBI said, “Prepaid payment instruments can be issues only to corporate entities listed in any of the stock exchanges in India.”
It further said the corporates would have to verify the identity of the employee to whom the card would be issued, along with copies of photograph and a proof of identity.
“The corporate is also required to make available details of bank accounts of the employee to the bank,” the RBI said.
The Central Bank appears to be trying to reduce the money laundering risks in the prepaid market by setting limitations and overall guidance regarding corporate purchases of prepaid instruments.
