RBI issues consolidated domestic money transfer rules; retains Rs 50,000 cash NEFT cap

The RBI issued consolidated domestic money transfer directions, retaining existing transaction limits while strengthening safeguards for cash-based remittances. The framework sets limits on cash deposits and payouts, mandates verified remitter details, introduces transaction monitoring and requires prompt reporting of suspicious activities

New Delhi: The Reserve Bank of India (RBI) has issued a consolidated set of directions on domestic money transfers, retaining existing transaction limits and tightening safeguards for cash-based remittances. Under the new framework, walk-in customers without an account at a bank branch can transfer up to Rs 50,000 in cash into a bank account through NEFT.

Banks can also allow such customers to send funds through business correspondents, ATMs and other permitted channels, subject to a cap of Rs 5,000 per transaction and Rs 25,000 per remitter in a month. For cash payouts to beneficiaries who do not have bank accounts, banks can facilitate transfers from customers’ accounts through ATMs, business correspondents or other authorised payment channels.

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However, these transfers are capped at Rs 10,000 per transaction, with a monthly ceiling of Rs 25,000 per beneficiary. These limits were part of the earlier framework and have been retained in the latest directions, according to the central bank.

It also retained the requirement for remitter registration on the basis of a verified mobile number and a self-certified officially valid document as prescribed under its Know Your Customer Directions, 2025. Moreover, remitting banks and business correspondents must include remitter details in the IMPS or NEFT transaction message.

Also, the message must carry an identifier to distinguish cash-based remittances. In addition, banks and non-banks have been asked to put in place safeguards, including velocity checks and alerts to customers about credits received through these facilities. Any unusual increase in the volume of credits in a particular account or group of accounts must be investigated immediately and suspicious transactions must be reported to the appropriate authorities.

Fund transfers under the new framework are expected to be effected on a real-time or near-real-time basis. Inter-bank settlement must be carried out only through RBI-approved payment systems.

Additionally, the directions apply to all scheduled commercial banks, including regional rural banks, urban co-operative banks, state co-operative banks and district central co-operative banks as well as authorised payment system operators and participants to the extent applicable to their domestic money transfer services. However, card-to-card transfers have been kept outside the scope of the directions.