Lok Sabha Question No. 1467 (UNSTARRED), answered on 2019-07-01
Subject: Promotion of Cashless Transactions
Ministry: FINANCE
Asked by: Arjunlal Meena, Sumedhanand Saraswati, Mohanbhai Kalyanji Kundariya

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA UN-STARRED QUESTION No. 1467

TO BE ANSWERED ON 1 st  July, 2019 (MONDAY) /ASHADHA 10, 1941 (SAKA)

'Promotion of Cashless Transactions'

1467. SHRI ARJUN LAL MEENA: SHRI SUMEDHANAND SARSWATI: SHRI  MOHANBHAI KALYANJI KUNDARIYA:

Will the Minister of FINANCE be pleased to state:

- (a) whether the Government proposes to give direction for the hundred percentage distribution  and  activation  of  Rupay  cards  by  the  banks  as  well  as  financial institutions  and  to  link  the  Aadhaar  Cards  with  the  bank  accounts  to  promote cashless transaction;

(b) if so, the details thereof and the time by which it is likely to be implemented and if not, the reasons therefor;

(c)  whether  the  Government  has  made/  proposes  to  make  sweeping  changes  in banking rules to encourage cashless transactions and if so, the details thereof; and

(d)  whether  the  Government  proposes  to  impose  limits  on  ATM  withdrawals  and impose  charges  on  cash  transactions  at  banks  and  if  so,  the  details  thereof?

## Answer

## THE FINANCE MINISTER

## (SMT. NIRMALA SITHARAMAN)

(a) & (b): As per Reserve Bank of India (RBI) guidelines, banks issue debit cards to customers in accordance with their Board approved policy.

As per Reserve Bank of India's (RBI's) Master Direction on Know Your Customer (KYC) dated 25.02.2016 (updated as on May 29, 2019), Banks obtain the Aadhaar number from an individual who is desirous of receiving any benefit or subsidy under any scheme notified under section 7 of the Aadhaar (Targeted Delivery of Financial and  Other  subsidies,  Benefits  and  Services)  Act,  2016  (18  of  2016).  Banks,  at receipt of the Aadhaar number from the customer may carry out authentication of the customer's  Aadhaar  number  using  e-KYC  authentication  facility  provided  by  the Unique  Identification  Authority  of  India  upon  receipt  of  the  customer's  declaration that  he  is  desirous  of  receiving  any  benefit  or  subsidy  under  any  scheme  notified under section 7 of the Aadhaar (Targeted Delivery of Financial and Other Subsidies Benefits and Services) Act, 2016 (18 of 2016) in his account.

Further, banks carry out Aadhaar authentication/ off-line verification of an individual who voluntarily uses his Aadhaar number for verification purpose.

(c) In order to give fillip to digital funds movement , RBI vide its circular on' National Electronic  Funds  Transfer  (NEFT)  and  Real  Time  Gross  Settlement  (RTGS) systems- Waiver of charges ' dated 11.06.2019, has decided that with effect from July 1, 2019, processing charges and time varying charges levied on banks by RBI for outward transactions undertaken using the RTGS system, as also the processing charges levied by RBI for transactions processed in NEFT system would be waived by the Reserve Bank of India . The banks have also been advised by RBI to pass on the benefits to their customers for undertaking transactions using RTGS and NEFT systems.

(d)  RBI  vide  its  Circular  dated  14.08.2014  on  rationalisation  of  number  of  free transactions, has inter alia provided the following :

-  A minimum of 5 free ATM transactions at a bank's own ATM at any location and at any other bank's ATM at non-metro location is permitted.
-  A minimum of three free transactions at any other bank's ATM at six metro locations viz. Mumbai, New  Delhi, Chennai, Kolkatta, Bengaluru and Hyderabad..
-  Ceiling  on  customer  charges  of  Rs  20/-  per  transaction  (plus  service  tax,  if any) will be applicable.

Banks have also been advised by RBI to ensure that the charges structure on ATM transactions, as per their Board approved policy, is informed to the customer in a fair and transparent manner.

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