Gift card (RBI regulations)

Reference – https://m.rbi.org.in/Scripts/BS_ViewMasDirectio...

10.1 Gift instruments

Banks and non-bank entities are permitted to issue prepaid gift instruments subject to the following conditions:

Maximum value of each prepaid gift instrument shall not exceed Rs.10,000/-.

These instruments shall not be reloadable.

Cash-out or refund or funds transfer shall not be permitted for such instruments.

KYC details of the purchasers of such instruments shall be maintained by the PPI Issuer. Separate KYC would not be required for customers who are issued such instruments against debit to their bank accounts in India.

The gift instruments may be revalidated (including through issuance of new instrument) as per the Board approved policy of the issuer.

The provisions of paragraph 13 on validity and redemption, as applicable, shall be adhered to.

The features of such PPIs shall be clearly communicated to the PPI holder by SMS / e-mail / post or by any other means at the time of issuance of the PPI / before the first loading of funds.

13. Validity and Redemption

13.1 All PPIs issued in the country shall have a minimum validity period of one year from the date of last loading / reloading in the PPI. PPI issuers are free to issue PPIs with a longer validity. In case the PPI is issued in the form of card (with validity period mentioned on the card), then the customer shall have the option to seek replacement of the card.

13.2 PPI issuers shall caution the PPI holder at reasonable intervals, during the 45 days’ period prior to expiry of the validity period of the PPI. The caution advice shall be sent by SMS / e-mail / post or by any other means in the language preferred by the holder indicated at the time of issuance of the PPI.

13.3 Non-bank PPI issuers cannot transfer the outstanding balance to their Profit & Loss account for at least three years from the expiry date of PPI. In case the PPI holder approaches the PPI issuer for refund of such amount, at any time after the expiry date of PPI, then the same shall be paid to the PPI holder in a bank account.

13.5 Issuers shall clearly indicate the expiry period of the PPI to the customer at the time of issuance of PPIs. Such information shall be clearly enunciated in the terms and conditions of sale of PPI. Where applicable, it shall also be clearly outlined on the website / mobile application of the issuer.

13.6 PPIs with no financial transaction for a consecutive period of one year shall be made inactive by the PPI issuers after sending a notice to the PPI holder/s. These can be reactivated only after validation and applicable due diligence. These PPIs shall be reported to RBI separately.

13.7 The holders of PPIs shall be permitted to redeem the outstanding balance in the PPI, if for any reason the scheme is being wound-up or is directed by RBI to be discontinued.