Page 58 - Banking Finance January 2025

RBI CIRCULAR

latory Policies dated October 9, 2024, proposing the dated August 27, 2021 on Prepaid Payment Instru-
introduction of beneficiary account name look-up facil- ments (MD-PPIs) (see Annex).
ity for Real Time Gross Settlement (RTGS) System and 3. This circular is issued under Section 18 read with Sec-
National Electronic Funds Transfer (NEFT) System. tion 10(2) of the Payment and Settlement Systems Act,
2. Currently, the Unified Payments Interface (UPI) and Im- 2007 (Act 51 of 2007).
mediate Payments Service (IMPS) systems enable a
remitter to verify the name of the beneficiary before Credit Flow to Agriculture – Collateral
initiating transfer. It has been decided to put in place
a similar facility that would enable a remitter to verify free agricultural loans
the beneficiary bank account name before initiating a December 06, 2024
transaction using RTGS or NEFT system. Accordingly,
National Payments Corporation of India (NPCI) has been 1. Please refer to our circular FIDD.CO.FSD.BC.No.13/
advised to develop the facility and onboard all banks. 05.05.010/2018-19 dated February 7, 2019 on the
above subject.
3. Banks which are participants of RTGS and NEFT Sys-
tems, shall make this facility available to their custom- 2. Keeping in view the overall inflation and rise in agricul-
ers through Internet banking and Mobile banking. The ture input cost over the years, it has been decided to
facility shall also be available to remitters visiting raise the limit for collateral free agricultural loans in-
branches for making transactions. Detailed require- cluding loans for allied activities from the existing level
ments for the same are provided in the Annex. of ?1.6 lakh to ?2 lakh per borrower. Accordingly, banks
are advised to waive collateral security and margin
4. All banks who are direct members or sub members of requirements for agricultural loans including loans for
RTGS and NEFT are advised to offer this facility no later
allied activities upto ?2 lakh per borrower.
than April 1, 2025.
3. The banks are advised to give effect to the revised in-
5. This directive is issued under Section 10 (2) read with
structions expeditiously and in any case not later than
Section 18 of Payment and Settlement Systems Act, January 1, 2025. The banks are also advised to give
2007 (Act 51 of 2007).
adequate publicity to the above changes.
Unified Payments Interface (UPI) access Maintenance of Cash Reserve Ratio (CRR)
for Prepaid Payment Instruments (PPIs) December 06, 2024

through third-party applications
1. Please refer to our circular DOR.RET.REC.33/
December 27, 2024 12.01.001/2022-23 dated May 04, 2022 and relative
notification on the captioned subject.
1. Currently, UPI payments from / to a bank account can 2. As announced in the Statement on Developmental and
be carried out using the UPI application of that bank Regulatory Policies dated December 06, 2024, it has
or of any third-party application provider. However, UPI been decided to reduce the Cash Reserve Ratio (CRR)
payments from / to a PPI can only be carried out using of all banks by 50 basis points in two equal tranches of
the mobile application provided by the PPI issuer. 25 basis points each to 4.0 per cent of net demand and
2. As announced in the Statement on Development and time liabilities (NDTL). Accordingly, banks are required
Regulatory Policies dated April 05, 2024, it has been to maintain the CRR at 4.25 per cent of their NDTL
decided to enable UPI payments from / to full-KYC PPIs effective from the reporting fortnight beginning De-
through third-party UPI applications. This will enable cember 14, 2024 and 4.00 per cent of their NDTL ef-
PPI holders to make / receive UPI payments through fective from fortnight beginning December 28, 2024.
the mobile application of third-party UPI applications. 3. A copy of the relative notification DoR.RET.REC.53/
The relevant provisions have been amended in Master 12.01.001/2024-25 dated December 06, 2024 is en-
Directions CO.DPSS.POLC.No.S-479/02.14.006/2021-22 closed.

52 | 2025 | JANAURY | BANKING FINANCE