Chief Executive Officers of
Madam / Dear Sir,
balances in customer accounts with payments banks – sweep out arrangements
with other banks
Please refer to paragraph 7(i) of the
Operating Guidelines for Payments Banks (‘Operating Guidelines’) dated
October 6, 2016, under which payments banks (PBs) were permitted to make
arrangements with a scheduled commercial bank / small finance bank (SFB),
for amounts in excess of the prescribed limits, to be swept into an account
opened for the customer at that bank.
2. Based on the comments /
proposals received from the payments banks, and keeping in view the
financial inclusion objective of the payments bank model, the following
instructions are to be followed:
are permitted to act as Business Correspondents (BCs) of other banks. Under
the BC arrangement and with prior specific or general consent of the
customer, PB may effect the transfer of funds deposited by her into her
account with another eligible bank, so that the balance in her account with
the PB does not exceed ?100,000 or any such lower amount as specified by
time, PB shall not have rights to operate or have real-time access to the
funds available in the account of the customer at any other bank, including
the transferee bank. However, as a BC of a bank, PBs may facilitate
withdrawals and transfers by the customer from her account with the bank of
which it is the BC. It is reiterated for clarity that PBs shall not
initiate any debit transactions in the customer’s account, held with
another bank, under a power of attorney or general consent of the customer.
shall neither arrange nor avail of intraday funding facilities for its
customers, based on the balances available in the customer’s account with
any other bank, or otherwise.
are required to closely monitor the accounts of their customers, to
identify and report suspicious transactions, when the deposit / transaction
volumes are not commensurate with the customer’s profile.
3. These instructions are in
addition to the Operating Guidelines ibid and take immediate effect.
Chief General Manager