1. Raise net worth requirement of PPI issuances to R25 crore: RBI

Raise net worth requirement of PPI issuances to R25 crore: RBI

In a move that could significantly restrict the playing field in prepaid instruments (PPIs) or wallets space, the Reserve Bank of India (RBI) on Monday issued a draft circular proposing that the net worth requirement of issuing entities be raised to R25 crore from R1 crore earlier.

By: | Mumbai | Published: March 21, 2017 5:27 AM
The draft has no reference to the paid-up capital requirement for such entities. (Reuters)

In a move that could significantly restrict the playing field in prepaid instruments (PPIs) or wallets space, the Reserve Bank of India (RBI) on Monday issued a draft circular proposing that the net worth requirement of issuing entities be raised to R25 crore from R1 crore earlier.

The draft has no reference to the paid-up capital requirement for such entities. At present, it stands at R5 crore. “Net-worth will consist of ‘paid up equity capital, preference shares which are compulsorily convertible into equity capital, free reserves, balance in share premium account and capital reserves representing surplus arising out of sale proceeds of assets but not reserves created by revaluation of assets’ adjusted for ‘accumulated loss balance, book value of intangible assets and deferred revenue expenditure, if any’,” the draft said.

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