Decoding The Key Changes Proposed Under The Simplified Master Direction On Prepaid Payment Instruments Issued By The RBI

The Reserve Bank of India (“RBI”) on April 22, 2026 issued the Draft Master Direction on Prepaid Payment Instruments, 2026 (“Draft PPI MD”), for comments / feedback through the ‘Connect 2 Regulate’ section on RBI’s website.

Once finalized and notified, the Draft PPI MD is intended to replace the existing Master Directions on Prepaid Payment Instruments dated August 27, 2021, as amended from time to time (“Current PPI MD”).

At the outset, it should be noted that the Draft PPI MD introduces new categories of prepaid payment instruments (“PPIs”), although similar types of PPIs already exist under the Current PPI MD. The new categories are:

• General Purpose PPIs: These include Full-KYC PPIs and Small PPIs. The two Small PPI subtypes (i.e., Small PPIs with cash loading and without cash loading facility) have been subsumed into a single category; and