RBI consolidates money transfer rules

NEW DELHI: The Reserve Bank of India (RBI) has consolidated its regulations governing domestic money transfers, allowing individuals to deposit up to Rs 50,000 in cash at a bank branch for transferring money to another person’s bank account through the National Electronic Funds Transfer (NEFT) system without maintaining an account with the bank.

The revised framework establishes transaction limits, monthly ceilings and additional safeguards to prevent fraud and misuse of cash-based transfers.

Under the rules, the maximum amount that can be received is Rs 10,000 per transaction, subject to a monthly limit of Rs 25,000 per beneficiary. For cash transfers via business correspondents, ATMs and other permitted channels, the limit is Rs 5,000 per transaction, with a monthly ceiling of Rs 25,000 per remitter.

The framework largely consolidates existing instructions rather than introducing significant changes to transaction limits. It is expected to benefit migrant workers, daily wage earners and individuals who need to send money to family members in different parts of the country.

Customers using these facilities must register with a verified mobile number and submit a self-certified officially valid document in accordance with the RBI’s Know Your Customer (KYC) requirements. Every transaction must also undergo an additional factor of authentication.

The framework also allows beneficiaries without bank accounts to receive money transferred from another person’s account and withdraw it in cash through ATMs, business correspondents or other authorised payment channels. Additionally, banks and non-bank entities have been directed to establish monitoring mechanisms to identify suspicious transactions.