rbi: RBI has increased the IMPS transaction limit: Key details

The Reserve Bank of India (RBI) on Friday announced a revision in the transaction limit for the Immediate Payment Service (IMPS) of National Payments Corporation of India (NPCI), increasing it from Rs 2 lakh to Rs 5 lakh.

IMPS is an important payment system providing 24×7 instant domestic funds transfer facility and is accessible through various channels like internet banking, mobile banking apps, bank branches, ATMs, SMS and Interactive Voice Response System (IVRS).

According to the RBI, the per-transaction limit in IMPS before today’s revision, effective from January 2014, was capped at Rs 2 lakh for channels other than SMS and IVRS, while the per-transaction limit for SMS and IVRS channels was Rs 5000.

With Real Time Gross Settlement (RTGS) now operational round the clock, there has been a corresponding increase in the settlement cycles of IMPS, thereby reducing the credit and settlement risks.

In view of the importance of the IMPS system in the processing of domestic payment transactions, it was proposed to increase the per-transaction limit from Rs 2 lakh to Rs 5 lakh for channels other than SMS and IVRS.

“This will lead to a further increase in digital payments and will provide an additional facility to the customers for making digital payments beyond Rs 2 lakh. Necessary instructions in this regard would be issued separately,” the RBI said.

Apart from this, the RBI has also introduced another cohort in its regulatory Sandbox. Reserve Bank’s Regulatory Sandbox (RS) has so far introduced three cohorts.

Six entities have successfully exited the First Cohort on ‘Retail Payments’ while under the Second Cohort on ‘Cross Border Payments’, eight entities are undertaking tests.

The application window for the Third Cohort of ‘MSME Lending’ is currently open.

With a view to prepare the fintech eco-system, it has been proposed that the topic for the Fourth Cohort would be ‘Prevention and Mitigation of Financial Frauds’. The focus would be on using technology to reduce the lag between the occurrence and the detection of frauds, strengthening the fraud governance structure and minimising response time to frauds. The application window for this cohort would be opened in due course.

The RBI Governor, Shaktikanta Das, today announced a new scheme on retail digital payments solutions in the offline mode.

“A scheme to test technologies that enable digital payments even in remote places where internet connectivity is either absent or barely available was announced in August 2020. Given the encouraging experience gained from the pilot tests, it is proposed to introduce a framework for retail digital payments in offline mode across the country. This will further expand the reach of digital payments and open up new opportunities for individuals and businesses,” he said.

In August last year, the Reserve Bank permitted small value offline transactions through cards and mobile devices for single payments of up to Rs 200 on a pilot basis.

Under the pilot scheme, Payment System Operators (PSO) banks and non-banks may offer digital payments offline (payments that do not require internet connectivity to take effect).

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