RBI · Prepaid Payment Instruments

PPI-03: KYC and customer onboarding

Paragraph-level professional implementation page for Prepaid Payment Instruments.

Prepaid Payment InstrumentsPPI-03PSS Act sections 10(2) and 18; PMLA/IT overlays

Finin2min Summary — in 2 Minutes

PPI-03 — KYC and customer onboarding. Apply PMLA/RBI KYC requirements and preserve consent and verification evidence.

Official source and legal ownership

Instrument ownerPSS Act sections 10(2) and 18; PMLA/IT overlays

Source statusCURRENT OFFICIAL SOURCE GATEWAY

Review date2026-07-19

Primary sourceMaster Directions on PPIs, updated 27 December 2024

Paragraph-wise Finin2min interpretation

Legal trigger

Apply PMLA/RBI KYC requirements and preserve consent and verification evidence.

Control owner

Business identifies the event; Compliance confirms law; Operations/Technology executes; Independent review tests evidence.

Evidence

Official source snapshot, policy/SOP, system rule, customer/transaction record, maker-checker log, exception approval and regulatory acknowledgement.

Failure consequence

Customer harm, reporting defect, prudential misstatement, supervisory observation, monetary penalty, restriction or remediation.

Practical example

Scenario: An exception arises under KYC and customer onboarding. The owner records the trigger, regulated entity, paragraph/reference PPI-03, affected customer or exposure, applicable threshold, approval and system evidence. Compliance then tests the result against the official source rather than relying on a generic policy statement.

Implementation and evidence controls

Freeze the applicable entity class, product, transaction date and official instrument version.
Map every control to its legal owner, enabling provision, responsible function, evidence and escalation route.
Retain Board/committee approval, policy version, system configuration, maker-checker evidence, exception approval and regulatory filing acknowledgement.
Re-test the control after an amendment, product change, outsourcing change, merger, customer-risk reclassification or supervisory observation.

Practical Q&A

What is the first test for KYC and customer onboarding?

Confirm entity, product, event date, official paragraph and any stated exception.

Can a portal or system acceptance cure a legal defect?

No. Technical processing does not override the substantive Direction.

What should be retained for review?

The official source version, legal mapping, calculation or decision record, approvals, communications and filing evidence.