Pre-Paid Cards: A New Way Of Digital Payment

The Debit and Credit Cards have become have become integral part of our life in the present day world. Of late, some other cards viz. Prepaid cards and Deposit Cards are also occupying an important space in our lives. These cards are coming up with different features to suit the requirements of individuals as well corporates.

- M. V. L. N. Suresh

Prepaid instruments (PPIs) have emerged as one of the most convenient payment tools for the people due to their under noted features:

i) Wide Acceptance - Accepted across most merchant outlets and online portals

ii) Virtual Card - Buy and deliver online without getting a physical card

iii) High Security - Secure usage with a unique PIN

iv) Flexible Denomination -Load any amount between Rs. 500 and Rs. 50,000.

Some popular pre- paid cards of leading Indian Banks

i) SBI - Smart Payout Card, Achiever Card, Insta Deposit Card

ii) ICICI Bank - Multi Wallet Card, Pay Direct Card, Pocket

iii) Axis Bank - Suvidhaa Prepaid Card, Smart Pay Card, Rewards Card,

iv) HDFC Bank - Forex Plus Platinum Card, Money Plus Card, Food Plus Card

v) Kotak Mahindra Bank - Kotak ItzCash Prepaid Card, Multi Currency world Travel Card.

Banks issue Prepaid instruments (PPIs)as per RBI guidelines. The PPIs are of following three categories:-

I. Closed System Payment Instruments:

These instruments facilitate purchase of goods/services from issuer outlets and do not permit cash withdrawal or redemption like Big Bazar payback cards, Amazon Gift Cards, Flipkart Gift Cards. As such these instruments are not covered under payment systems.

II. Semi-closed System Payment Instruments:

These are the payment instruments which can be used for purchase of goods and services, including financial services at a group of clearly identified merchant locations/ establishments and do not permit cash withdrawal or redemption by the holder.

III. Open System Payment Instruments: