The Reserve Bank of India has hiked the daily ceiling for banking transactions through mobile phones to Rs 50,000, from the present cap of Rs 15,000.
Mobile banking applications enable payments made from customer’s account through debit / credit on the basis of funds transfer instruction received over the mobile phones.
Earlier, daily funds transfer was limited to Rs 5,000 and transactions involving purchase of goods or services to Rs 10,000. Now the total transaction limit is set to Rs 50,000. Banks had complained that the limit of Rs 5,000 does not permit transactions like purchase of air tickets through mobile banking and, thus this limits needs to hiked.
Banks had complained that the current requirement of end-to-end encryption makes implementation of mobile banking costly and that RBI should do away with this requirement. Now transactions up to Rs 1,000 can be facilitated by banks without end-to-end encryption. However, banks will have to ensure that the risk aspects involved in such transactions is addressed through adequate security measures.
RBI has also placed cap of Rs 5,000 per transaction and Rs 25,000 on per month per customer, on mobile banking transaction, if the delivery to recipient is in cash. At present, RBI permits use of mobile phone for remittance of cash wherein funds are transferred from customers account for delivery in cash to the recipients. The disbursal of funds to recipients of such services can be facilitated at ATMs or through any agent appointed by the bank as business correspondents.
RBI has placed a cap of Rs 5,000 per transaction, only if the recipient get money in cash. Earlier RBI has not capped such transaction and this it fell in the limit of Rs 5,000 limit, which was applicable for transfer of funds Further, earlier RBI had left it on the bank to decide the limit of monthly transaction per person, if the delivery is in cast to recipient.
RBI said banks can provide such fund transfer service provided they are responsible, as principals for all the acts of omission or commission of their agents. The disbursal of funds at the agent/ATM shall be permitted only after identification of the recipient. Banks should carry out proper due diligence of the persons before appointing them as authorized agents for such services. [source]