Offline Digital Payments: RBI Issues Guidelines

Offline Digital Payments: Relevance

• GS 3: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment.

Offline Digital Payments: Context

• Recently, RBI has released a framework for small-value offline transactions in the digital mode to increase digital transactions in rural and semi-urban areas.

What is offline payment?

• An offline payment means a transaction which does not require internet or telecom connectivity to take effect.
• The guidelines are directed to push digital transactions in rural and semi-urban areas.
• Authorised payment system operators (PSOs) and payment system participants (PSPs) —banks as well as non-banks —which wish to offer payments in the offline mode will have to comply with the requirements under the framework.

Offline Digital Payments: Guidelines

• Offline payments may be made using any channel or instrument like cards, wallets, mobile devices, etc.
• Offline payments shall be made in proximity (face to face) mode only.
• Offline payment transactions may be offered without Additional Factor of Authentication (AFA).
• Payment instruments shall be enabled for offline transactions based on explicit consent of the customer. Such transactions using cards shall be allowed without a requirement to switch on the contactless transaction channel.
• The upper limit of an offline payment transaction shall be ₹200. The total limit for offline transactions on a payment instrument shall be ₹2,000 at any point in time. Replenishment of used limit shall be allowed only in online mode with AFA.
• The issuer shall send transaction alerts to users as soon as transaction details are received. There is no compulsion to send alert for each transaction; however, details of each transaction shall be adequately conveyed.
• The acquirer shall incur all liabilities arising out of technical or transaction security issues at merchant’s end.
• Offline payments shall be covered under the provisions of RBI’s limited customer liability circulars (as amended from time to time)
• The customers shall have recourse to the Reserve Bank – Integrated Ombudsman Scheme, as applicable, for grievance redressal.
• Reserve Bank retains the right to stop or modify the operations of any such payment solution that enables small value digital payments in offline mode.

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