New Delhi, April 22 -- The Reserve Bank of India has issued a draft paper on prepaid payment instruments (PPIs), proposing the introduction of prepaid wallets for special use cases such as domestic transit, foreign nationals or non-resident Indians (NRIs) in India, and gifting. It also notified capital requirements for issuers of such wallets, while barring the use of PPIs for cross-border transactions.

PPIs are digital wallets that allow users to load money in advance and use it to make payments. PPIs are currently divided into two categories: full-KYC wallets, which require strict identity verification, and small wallets, which have simpler onboarding rules. "A PPI may be issued as a card, wallet, or in any such form/instrument which c...