Conceptual framework

Prepaid Payment Instruments (PPIs): PPIs are payment instruments that facilitate purchase of goods and
services, including financial services, remittance facilities, etc., against the value stored on such
instruments. In exercise of the powers conferred under Section 18 read with Section 10(2) of the
Payment and Settlement Systems (PSS) Act, 2007, RBI has issued these Master Directions.
consumers Prepaid debit cards are issued by banks and branded by the major credit card companies,
including Visa, MasterCard, Discover, and American Express. it an initiative by the government’s
encouragement towards cashless economy. the in addition to this, increasing number of organized
retailers has also contributed to the growth of the prepaid cards market in India.

PPIs that can be issued in the country are classified under three types: -

Prepaid meal
Closed System PPIs
instruments

Prepaid Payment Semi-closed System

Gift instruments
Instruments (PPIs) PPIs

PPIs for Mass Transit

Open System PPIs
Systems (PPI-MTS)

PPIs for cross-border

outward transactions

PPIs for credit

Specific categories of Cross-Border
PPIs Transactions towards cross-border
inward remittance

Foreign Exchange PPI

 Closed System PPIs: These PPIs are issued by an entity for facilitating the purchase of goods
and services from that entity only and do not permit cash withdrawal. the issuance and operation
of such instruments is not classified as payment systems requiring approval /
authorization by the RBI.

Semi-closed System PPIs: These PPIs are used for purchase of goods and services, including
financial services, remittance facilities, etc. These instruments do not permit cash withdrawal,
irrespective of whether they are issued by banks or non-banks.

Open System PPIs: These PPIs are issued only by banks and are used at any merchant for
purchase of goods and services, including financial services, remittance facilities, etc.

Key Players

the India prepaid cards market, covering their competitive landscape, capacity, and latest developments
like mergers, acquisitions, and investments, expansions of capacity, and plant turnarounds:

 Axis Bank
 ICICI Bank
 State Bank of India
 HDFC Bank
 Punjab National Bank
 Yes Bank
 Kotak Mahindra Bank
 Others

State Bank of India (SBI): - launched a prepaid card on 23 April 2013. It was the Frist card launched
by Sbi ‘State Bank Smart Payout Card’ It is an ideal product for making periodical payments like
salary, wages, commission, etc. and also can be issued as an add-on Card for the existing account
holders. After that Sbi launch many types of prepaid card like

 State Bank Gift Card

 State Bank EZ PAy Card
 State Bank Foreign Travel Card (Convenient & Safe foreign travel)
 State Bank Achiever Card (Instant Gratification)
 SBI NMRC City1 Card
 Nagpur Metro Maha Card
Axis Bank: - Eyeing business from foreign nationals and people from the diaspora visiting India, private
sector lender Axis Bank on February 2, 2011 launched the country’s first currency prepaid card for such
travelers. The ‘India Travel Card’ can be funded with any major international currency and after
conversion, will allow customers to use the deposited amount in Indian currency to either shop or
withdraw at ATMs. Then after Axis has collaborated with Suvidha Info serve to launch a prepaid card on
27 April 2015. The card aptly title Axis Bank-Suvidha prepaid card leverages e-KYC platform to help
customers deposit and withdraw cash instantly. The various prepaid cards offered by Axis bank are:

:-

 Meal Card
 Gift Card
 Smart Pay Card
 Axis Bank One Mumbai Smart Card
 KMRL Axis Bank Kochi1 Card

Usage of prepaid card

The purpose of using prepaid Card in industry into:

Payroll/Incentive
Travel
General Purpose Reloadable (GPR)
Remittance
Prepaid Card Others

Based on the vertical, the industry can be divided into:

 Corporate/Organization
 Retail
 Government
 Others
Benefits of Prepaid Credit Cards(individual)

 Prepaid credit cards can be used to pay for any good or service and customers do not have to
worry about the hassles of making cash transactions.
 Open looped prepaid cards can be used to make ATM cash withdrawals by customers.
 Spends would not go overboard as customers can easily plan their expenses and purchase goods
only within the limit of the card.
 As long as the prepaid credit card is valid, customers can always get extra cash for urgent
purchases and transactions.
 Credit score of an individual is not a major criterion to qualify for a prepaid credit card.
 Prepaid credit cards are the easiest to procure, if the applicant is not looking for any other type
of credit card.
 Prepaid credit cards can be used for paying outstanding bills through a customer’s mobile
phone.
 For employee not holding a bank account, salaries can be distributed using prepaid credit cards
by employers.
 Prepaid cards can also function as a gift card and can be used as travel cards to load currency
when an individual is traveling abroad.
  State Bank of India offers multiple types of prepaid credit cards depending on the requirement
of the applicant. Customers taking the SBI prepaid card need not have any bank account and can
be used for e-commerce transactions and cash withdrawals. The various cards offered by State
Bank of India are:
1) State Bank Smart Payout Card
2) State Bank Xpress Money Card
3) State Bank Achiever Card

The State Bank Smart Payout Card is offered in collaboration with Visa and can be used for making salary
or commission payments.

 Card holders can use the card to make cash withdrawals, purchase transactions and for online
payments.
 The State Bank Smart Payout Card is issued in Indian Rupees and is valid for a period of 10 years.
The minimum amount that can be loaded is Rs. 100 to up to Rs 10,000.
 The State Bank Xpress Money Card can be used to make inward remittances from countries
across the world. This service can be used through Money Transfer Service Scheme (MTSS) of
Reserve Bank of India via UAE Exchange and Financial Services Ltd.

 State Bank Xpress Money Card is a prepaid card using which customers can make cash
withdrawals, PoS and e-commerce payments.
 The State Bank Achiever Card can be used by corporates to make incentive payments to their
employees. The card can be loaded multiple number of times up to a limit of Rs. 1 lakh and
customers can make PoS and online transactions using the card.

Axis Bank Prepaid Cards - Smart Pay Card

 As a rupee denominated prepaid card, the Axis Bank Smart Pay Card can be used by employers
to disburse employee salaries, reimbursements and cash to their employees. This card ensures
that payouts happen immediately and on secure platforms.
 The Axis Bank Smart Pay Card is a reloadable card and funds can be added by the employer.
Customers can pick up an Axis Bank Smart Pay Card at any Axis Bank branch.
 Issued in collaboration with Visa, this prepaid card can be used at any merchant outlet to ATM
to withdraw cash. The Axis Bank Smart Pay Card can also be used for online shopping and other
transactions using the Verified by Visa (VbV) platform.
 Applicants need not hold a bank account or maintain any balance to procure an Axis Bank Smart
Pay Card.
 Customers can loan any amount between Rs. 500 to Rs. 50,000 for one day, with the daily cash
withdrawal limit at Axis Bank ATMs being Rs. 20,000 and the daily limit for PoS transactions
being Rs. 50,000.
 The Axis Bank Smart Pay Card comes with zero lost card liability insurance against fraudulent
transactions.