A comprehensive handbook on Card Terminology, … in our interactions with the representatives of...

Taking Rural India >> Forward

An initiative of

Special Project Unit – KCC, Head Office, NABARD, Bandra (E

A comprehensive handbook on

Terminology,

Guidelines for

services by Regional Ru

Cooperative Banks

Taking Rural India >> Forward

An initiative of NABARD and NPCI

KCC, Head Office, NABARD, Bandra (E), Mumbai

[email protected]

A comprehensive handbook on Card

erminology, FAQs and NABARD

for providing card enabled

services by Regional Rural banks and

Cooperative Banks

), Mumbai– 400 051

Card

NABARD

providing card enabled

ral banks and

Preface

Banking technology in recent years has been defined by newer forms of payment systems and delivery

innovations. These rapid changes in technology have brought along with them new terminology, phrases,

products and players driving these changes.

There is, for obvious reasons, a lack of awareness about these new phrases and technology among those

who have joined or are in the process of joining this new technology space only recently. This has also been

observed in our interactions with the representatives of Regional Rural Banks and Cooperative banks.

A need was therefore felt to bring together various common terms and systems involved in joining National

Financial Switch (NFS) by these banks.

An effort has been made in this direction by NABARD along with National Payments Corporation of

India (NPCI) to bring a single point reference to the various concerned stake holders in the rural banking

sector. Along with the common new terms, we have added a section on Frequently Asked Question

(FAQs), the steps involved in joining NFS as well as the details of various schemes of NABARD.

We hope that this document will bring a level of comfort for interested banks in understanding technical

terms and methodologies involved in on-boarding new systems.

I wish to place on record my sincere gratitude to NPCI for coming together with NABARD in bringing out

this reference document in a very short span of time.

Niraj Kumar Gupta

Chief General Manager

Special Project Unit – KCC

04 March, 2013

I N D E X

Sr.

No.

Particulars Page

No.

1 Gist of support available for RRBs for issuing KCC 1

2 Gist of support available for Cooperative Banks for issuing

KCC

5

3 Guidelines for joining National Financial Switch (NFS) for

ATM and POS application

9

4 Guidelines for joining RTGS / NEFT Network 11

5 Formats for availing assistance from NABARD 13

6 Frequently Asked Questions (FAQs) for Banks 19

7 Glossary of common words and acronyms used in card

based transactions

46

For any assistance / clarifications kindly contact us at [email protected]

1

Gist of support available for RRBs for issuing KCC

Banks may ensure the following before availing grant assistance from NABARD:

1) RRBs to sign General Agreement for availing grant assistance with NABARD as per our

circular No. 08 / FID – 01 / 2012 dated 6 January 2012, if not already signed in the past.

2) Banks to forward a copy of all the agreements signed by the bank with various vendors

to NABARD Regional Offices

A. Financial Inclusion by Regional Rural Banks (RRBs) – Support for ICT solutions from

FITF

A.1. Objective : The overall objective of the scheme is to provide technology support

through POS and ICT cards (RuPay Kisan Cards) to enable Regional Rural Banks to

provide doorstep banking facilities. This will enable the clients of Regional Rural

Banks to connect with national payment system and avail all types of financial

services. All existing and future KCCs will be covered under this scheme.

A.2. Eligibility : The project is to be implemented in all CBS enabled branches of RRBs in

each State. The bank is to ensure that certification standards as specified by various

agencies are being adhered to for RuPay cards and POS machines / micro ATMs.

A.3. Scope of support : The type of support available under this scheme is given below:

I. Cost of Micro ATM / POS terminals upto Rs. 25,000/- per terminal (should be

owned by the bank and conform to the standards specified by IBA-IDRBT and

UIDAI 1.5 standard). The assessment for the POS terminals / micro ATMs may

be done as under:

(a) No. of CSPs / BCs to be covered

(b) No. of agri input suppliers to be covered (should be owned by the bank)

and

(c) Spare terminals as backup in the bank (upto 10% of the total, if requested

by the bank).

II. Cost of printing and issuing RuPay Kisan Cards upto Rs. 25/- per card (should

be owned by the bank and conform to standards specified by NPCI). The card

can be a non-personalised card, which can be given as a part of the “Welcome

Kit” to the customer.

In case of proposals other than KCC, banks may be guided by the Regional Offices of

NABARD.

2

A.4. Operationalisation of Scheme : It was earlier decided to approach the service

provider selected through the common RFP process for providing technical as well

as BC services in each cluster. Later on, in all cases where the RFP process has not

stabilised, they were advised to continue with the existing service providers.

Further, for various integrations and other related issues, RRBs may seek the

support of Sponsor Banks.

Support from any other agencies, if availed, may be excluded from the claim.

A.5. Pattern of assistance : The concerned RRB may work out a project report covering

the total number of POS terminals, RuPay Kisan cards required and submit to the

RO. The pattern of assistance thereafter will be as under:

1) Cost of POS terminals : Release of grant will be on reimbursement basis.

2) Cost of printing and issuing RuPay Kisan cards : Release of this grant assistance

will be in tandem with achievement. i.e.,

On coverage of 25% of the

operational accounts

25% of the total eligible cost of the cards










A.6. Extent of support : The extent of support will be 100% in North Eastern Region,

Sikkim, Chhattisgarh, Jammu & Kashmir, Uttarakhand, Jharkhand, Himachal Pradesh

and Andaman & Nicobar Islands and 80% in the rest of the country.

A.7. Duration of Support : The assistance will be extended for a period of 3 years.

B. Operational Support for ATM from FITF:

B.1. Objective : Regional Rural Banks are being encouraged to provide RuPay KCC to

their clients. These cards will be used on ATMs / micro ATMs with agri vendors

which will result in operational expenditure for the Regional Rural Banks. This

scheme is an effort to offset this cost.

3

B.2. Eligibility : All Regional Rural Banks which are fully CBS enabled and have issued

RuPay KCC are eligible for support under the scheme.

B.3. Scope of support :

The scheme covers only operational cost. No capital expenditure is covered. The

Interchange fees / transaction charges upto Rs. 15/- per KCC transaction arising out

of the use of RuPay ATM / Debit Kisan Cards on an ATM other than the parent bank

including that of white label ATMs (as and when these ATMs will be deployed in the

field) will be reimbursed. This reimbursement is only for KCC transactions.

B.4. Operationalisation of Scheme :

Upon stabilisation of the system, the RRB may forward a letter to NABARD

informing about the number of ATM cum Debit cards proposed to be issued to KCC

customers. The concerned NABARD Regional Office will provide an approval for the

same after verifying the claim. Later, on quarterly basis, the bank may approach

NABARD for reimbursement along with system generated information of various

expenditures.

B.5. Pattern of assistance : Reimbursement on quarterly basis.

B.6. Extent of support : The extent of support will be 100% in North Eastern Region,



B.7. Duration of Support : The assistance is on reimbursement basis and the banks can

forward their claims to ROs every quarter. The support will be extended upto March

2014 with the scheme subject to review thereafter.

C. Support for demonstrating banking technology from FIF

C.1. Objective : To Provide financial support to Regional Rural Banks for demonstrating

the usage of RuPay Kisan Cards on ATMs and POS machines / micro ATMs. This

medium of banking would encourage financial inclusion as well as technology in

rural banking.

C.2. Eligibility : All CBS enabled Regional Rural Banks

C.3. Operationalisation of Scheme : Under the scheme, a Mobile van fitted with ATM

and POS machines / micro ATMs will visit villages in the area of operations of the

RRBs and work primarily as a literacy tool by demonstrating use of ATMs / POS

machines / micro ATMs. The bank will also provide financial literacy material about

4

the KCC debit cards, ATM services and POS terminals / micro ATMs to be provided

in vernacular languages in the Mobile Van.

C.4. Components eligible for support under the scheme: The assistance may be utilized

for a Mobile Van, ATM, GPRS Router, UPS, POS terminal / micro ATM, etc. (and any

other incidental expenditures linked to the project) and financial education material

in vernacular language.

C.5. Scope of assistance : Upto Rs. 10 lakh. One mobile van per RRB

C.6. Pattern of assistance : 50% advance may be disbursed once the RRB has accepted

the general terms and conditions specified in the RO sanction letter. Balance

amount will be released by the Regional Office on reimbursement basis based on

the progress of implementation.

C.7. Duration of Support : The assistance will be extended till March 2014.

C.8. Extent of support : The extent of support will be 100% in North Eastern Region,



D. Support under FIF for other activities :

There are various capacity building schemes in place under FIF to help the banks in

undertaking technology upgradation for their staff and clients. Banks may make use of

the support available for the same.

5

Gist of support available for Cooperatives for issuing KCC

Banks may ensure the following before availing grant assistance from NABARD:

1) Banks to sign General Agreement with NABARD for availing grant assistance, the details

of which can be availed from Regional Offices of NABARD.

2) Banks to forward a copy of all the agreements signed by the bank with various vendors

to NABARD Regional Offices

A. Financial Inclusion by Cooperative Banks – Support for ICT solutions

A.1. Objective : The overall objective of the scheme is to provide technology support

through POS and ICT cards (RuPay Kisan Cards) to enable cooperative banks to provide

doorstep banking facilities. This will enable the clients of cooperatives to connect with

national payment system and avail all types of financial services.

A.2. Eligibility : The project is to be implemented in all CBS enabled Cooperative Banks in

each State. The bank is to ensure that certification standards as specified by various

agencies are being adhered to for RuPay cards and POS machines / micro ATMs.

A.3. Scope of support : Three types of supports are available under this scheme.

I. Cost of Micro ATM / POS terminals upto Rs. 25,000/- per terminal (should be

owned by the bank and conform to the standards specified by IBA-IDRBT and

UIDAI 1.5 standard). The assessment for the POS terminals / micro ATMs may be

done as under:

(a) No. of branches where the terminals are to be placed

(b) No. of PACS to be covered and

(c) Spare terminals as backup in the bank (upto 10% of the total, if requested by

the bank).

II. Cost of printing and issuing RuPay Kisan Cards upto Rs. 25/- per card (should be

owned by the bank and conforming to the standards specified by NPCI). The card

can be a non-personalised card, which can be given as a part of the “Welcome

Kit” to the customer.

III. Cost of integration charges between POS and CBS server.

A.4. Operationalisation of Scheme : It was earlier decided to approach the service provider

selected through the common RFP process for providing technical as well as BC services

in each cluster. Later on it was advised to approach the service provider identified by

6

the RRB / Lead Bank. Cooperative Banks may not require BC services but only

technology support for operationalisation of ATM, POS terminals / micro ATMs. Banks

may approach the Technology Service Provider (TSP) approved by NPCI for these

services.

A.5. Pattern of assistance : The concerned Cooperative bank may work out a project report

covering the total number of POS terminals, RuPay Kisan Cards required and the cost of

integration between POS terminals and CBS of the bank. The pattern of assistance

thereafter will be as under:

1) Cost of POS terminals : Release of grant will be on reimbursement basis.

2) Cost of printing and issuing RuPay Kisan cards : Release of this grant assistance

will be in tandem with achievement. i.e.,













3) Cost of integration charges between POS and CBS server : Support for this

would be on reimbursement basis.

A.6. Extent of support : The extent of support will be 100% in North Eastern Region, Sikkim,

Jammu & Kashmir, Uttarakhand, Jharkhand, Himachal Pradesh, Chhattisgarh and

Andaman & Nicobar Islands and 90% in the rest of the country.

A.7. Duration of Support : The assistance will be extended for a period of 3 years.

B. Operational Support for ATM:

B.1. Objective : Cooperative banks are being encouraged to provide RuPay Kisan Cards to

their clients. These cards will be used on ATMs / micro ATMs with agri vendors which

will result in operational expenditure for the cooperative banks. This scheme is an effort

to partly meet this cost.

B.2. Eligibility : All Cooperative banks which are fully CBS enabled and have issued RuPay

Kisan cards are eligible for support under the scheme.

7

B.3. Scope and pattern of support : The scheme covers only operational cost. No capital

expenditure is covered. There are three types of supports available under this scheme.

1. ATM Add-on Support for CBS : If the bank is running its CBS on ASP model, then

an amount upto Rs. 580/- per branch per month is reimbursed. If the bank runs

its CBS on ownership model, then an amount upto Rs. 20,000/- will be

reimbursed per branch as one time cost. Support for ASP model is extended for a

period of 3 years.

2. Switching Fee : An amount of up to Rs. 3/- per transaction for all transactions will

be reimbursed towards switching fee charges.

3. Inter-change / Transaction charges : The interchange fees / transaction charges

upto Rs. 15/- per KCC transaction arising out of the use of RuPay ATM / Debit

Kisan Cards on an ATM other than the parent bank including that of white label

ATMs (as and when these ATMs will be deployed in the field) will be reimbursed.

The support is only for KCC transactions.

B.4. Operationalisation of Scheme : It is recommended that cooperative banks adopt the

ASP route for providing ATM services to their clients considering the huge capital

expenditure involved in establishing and maintaining an ATM network as well as the

level of comfort with advanced banking technology which is as yet not present in the

cooperative banks.

Upon stabilization of the system, the cooperative bank may forward a letter to NABARD

informing about number of RuPay KCCs issued to its farming clientele. The concerned

NABARD Regional Office will provide an approval for the same after verifying the claim.

Later, on a quarterly basis, the cooperative bank may approach NABARD for

reimbursement along with system generated information of the various expenditures.

B.5. Extent of support : The extent of support will be 100% in North Eastern Region, Sikkim,

Jammu & Kashmir, Uttarakhand, Jharkhand, Himachal Pradesh, Chhattisgarh and

Andaman & Nicobar Islands and 90% in the rest of the country.

B.6. Duration of Support : The assistance for this scheme is on reimbursement basis and the

banks can forward their claims to ROs every quarter. The support will be extended till

March 2014 with the scheme subject to review thereafter.

8

C. Support under FIF :

There are various capacity building schemes in place under FIF to help the banks in

undertaking technology upgradation for their staff and clients. Banks may make use of

the support available for the same.

9

Methodology to join National Financial Switch (NFS) for ATM & POS

Application

1.1. Direct member of NFS

The bank should fulfill the following General and Technical Eligibility criteria for

becoming direct member of NFS

General Criteria

� Bank should have valid Banking License from RBI.

� Bank should have Current A/c with RBI

� Bank should have networked ATM and own their ATM Switch

� Bank should be RTGS Member of RBI

Technical Criteria

� Use of HSM (External Host Security Module) for encryption and decryption

� FIPS 140-1/140-2 or FIPS 197 certified crypto product (HSM Standard)

� Pin Generation and verification using HSM

� ATMs and POS should have unique Key per terminal

� Use of Double length Triple Des keys for terminals and translations

� Mandatory Pin, CVV1 and expiry date verification by issuers

A bank fulfilling all the above criteria may submit the application form to NPCI in the

prescribed format. NPCI issues the direct member certificate after examining the all

the details submitted by the bank

1.2. Indirect member (Sub member) of NFS

A bank that does not fulfil the General and Technical Criteria mentioned in 1.1 can

join NFS as a sub member. In order to join NFS through a Sponsor Bank which is

already a direct member of NFS the bank may follow the following steps:

i) May negotiate with any direct member bank of NPCI.

ii) Discuss the commercial terms

iii) The Sponsor Bank should specify the Application Service Provider (ASP) who will

be offering switching services to the bank.

iv) The ASP should be a certified ASP of NPCI; else the ASP may undergo the

necessary certification.

v) The Sponsor Bank should assume the role of being the sole clearing and

settlement agency

10

1.3. Steps to be followed by banks for the issue of RuPay debit / KCC cards

i) Bank to take internal board approval for obtaining IIN from NPCI.

ii) a) Direct Member: Bank to approach NPCI with the board approval for obtaining

Institution Identification Number (IIN).

b) Indirect member: Bank to approach its Sponsor Bank with the board approval

for obtaining Institution Identification Number (IIN) from NPCI. IIN application to

be sent by the bank to NPCI, with an endorsement letter from the Sponsor Bank.

iii) Allotment of RuPay Kisan Card IIN by NPCI

iv) Sharing of card design files and RuPay card specification by NPCI

v) Sharing of sample embossa file and testing by Bank and NPCI(detailed testing

procedure will be shared by NPCI)

vi) On successful testing go live status accorded directly / in conjunction with the

Sponsor Bank

vii) Banks to select card vendor who has sufficient expertise in the card printing field.

viii) The RuPay Kisan Cards will work at any of the 1,00,000 plus ATMs of more than

68 member banks on the National Financial Switch (NFS) network.

ix) The RuPay Kisan Cards are designed to work at micro ATMs with Aadhaar

Authentication / or local biometric authentication. The Technical specifications of

the Card to be as per NPCI defined standards and micro ATM specifications to be

as per UIDAI 1.5 Standards.

11

Methodology to join of RTGS / NEFT Network

1.1. Direct Membership

Eligibility criteria

• Membership is open to all licensed banks.

• The entity should satisfy the following Financial Criteria –

i. Minimum CRAR of 9% (as per the latest audited balance sheet);

ii. Net NPAs below 5% (as per the latest audited balance sheet);

iii. Minimum net-worth of Rs. 25 crore; and

iv. Recommendation of the regulatory department concerned.

• Apply to RBI in the prescribed format

• The entity on fulfilling the access criteria would simultaneously be granted

membership to INFINET, be eligible for opening current account at the Deposit

Accounts Department (RBI, Mumbai), SGL/CSGL account (RBI, Mumbai),

• Bank shall at its own cost and responsibility install and maintain in good order

the RTGS / NEFT Infrastructure (hardware, software, networking and security

products), as required/recommended by the RBI for the purpose.

• RTGS members should upgrade/modify/replace such Computer Systems

(hardware, software, networking and security products) and other associated

components in this regard from time to time as directed by RBI.

• The Computer Systems should be located securely within each RTGS member’s

premises such that access to them is restricted to that member’s authorised

personnel only.

1.2. Indirect Membership

Banks which fail to fulfil the access criteria mentioned in 2.1 or because of cost

considerations can join RTGS / NEFT Network as a Indirect member. To join RTGS /

NEFT Network as an Indirect member, banks may follow the following procedure:

i) May negotiate with any direct member bank of RTGS/NEFT Network (Sponsor

Bank).

ii) Discuss the commercial terms. (The charges for customer transactions of sub-

member cannot exceed the charges applicable to customers of sponsor

banks/direct members of the centralised payment systems viz., RTGS and NEFT.)

iii) Apply for a sub-member IFSC from the Sponsor bank.

iv) There will be no branch-wise IFSC number – only bank-wise.

v) Establishment of Network connectivity between the Sub member bank and the

Sponsor bank.

vi) Banks will have to open current accounts with the Sponsor Bank for settlement

of transactions.

12

vii) Banks will have to maintain a minimum balance in the current account as may be

decided by the Sponsor bank.

viii) The sponsor bank would be responsible for sending/receiving all the

transactions/messages on behalf of their sub-member.

ix) Aspects relating to operational feasibility, risk mitigation, fund settlement,

collateral etc have to be taken care by the sponsor bank.

x) The sponsor bank should put in place a risk management framework and a

system of continuous monitoring of the risk management practices of sub-

member/s that they desire to sponsor. The risk management framework should

be approved by the Board of the sponsor bank.

xi) The sponsor bank under this arrangement will assume complete responsibility

for the settlement of all transactions by/on the sub-members.

xii) Redressal of all customer complaints / grievance would be the responsibility of

the sponsor bank.

xiii) Sponsor bank will provide daily report for all transaction so as to enable the

client bank to reconcile the transactions.

13

Format for submitting KCC proposal – Regional Rural Banks

-------------------------------------------------------------------------------------------------------------

Ref. No: Date:

The Chief General Manager, NABARD,

…….................................... Regional Office

Dear Sir,

Proposal for assistance under FITF for Rupay KCC cards and Micro ATMs.

We hereby submit a project seeking Grant Assistance under prevailing guidelines of FITF.

1. Technical details of the bank are as under :

a) Name of the Sponsor bank : ………………………….

b) Name of the FI Service Provider : …………………..

c) Name of CBS service provider : ……………………….

d) Name of ATM service provider : ………………………

e) Name of vendor & model number of the Micro ATMs being purchased : ……………

2. NPCI has allotted the following IIN number(s) to our bank :

a. IIN for RuPay Aadhaar Kisan Card is : ……………………………

b. IIN for RuPay without Aadhaar Kisan Card is : …………………………….

3. We confirm that :

a. The bank’s Board has approved undertaking of this project in its ….. Board Meeting

held on …………….. .

b. The designs of both Aadhaar & Non-Aadhaar cards have been approved by NPCI.

c. We have issued instructions to our branches to open Aadhaar based Accounts and

updation of existing Accounts with Aadhaar No. wherever Aadhaar No or Aadhaar

Enrolment No. is available.

14

d. Micro ATM devices complying with UIDAI 1.5 standards and any subsequent

modifications thereafter will be purchased.

4. In this connection the following information relating to project particulars along with

respective costs is being submitted :

Sr. Details of support Number Amount

1 Number of operational KCC accounts in the bank NA

2 Number and cost of KCC Rupay ATM cards @ ` .. each

3 Number of Micro ATMs terminals owned by the bank , to

be deployed @ ` …. each.

To be deployed with BCs

To be deployed with Agri Vendors

Upto 10% additional back up machines

4 Total cost of project NA

We also confirm that the above Rupay KCC cards will be issued by …….. and Micro ATMs will

be operationalized by ……… .

Yours Faithfully

Chairman /General Manager

15

Format for submitting Project Report for ATM proposal – Regional Rural

Banks

-------------------------------------------------------------------------------------------------------------

The Chief General Manager

….....................….. Regional Office

NABARD

Dear Sir

Sub : Project report seeking assistance for Inter-change charges

We are submitting the following information relating to our RRB’s interface with the

ATM network system for claiming re-imbursement of expenses arising out of KCC

Rupay Debit cards:

Sr. No. Particulars RRB’s comments

1 Name of RRB

2 Name of Sponsor bank

3 Whether covered under the amalgamation

policy of GOI

4 Status of integration between RRB’s CBS

and Sponsor Bank’s CBS

5 Status of integration between RRB’s FI server

and its CBS

6 Number of ATMs in RRB’s ATM network

(including sponsor bank’s ATMs)

7 Number of KCC accounts in the RRB

8 Number of KCC account holders with Rupay

cards (as on date)

We agree to submit quarterly claims seeking re-imbursement of interchange

charges arising on Rupay Debit cards issued by our bank to our KCC account

holders.

Chairman / Chairperson

Regional Rural Bank

16

Format for seeking Reimbursement on Quarterly basis for ATM proposal –

Regional Rural Banks

-------------------------------------------------------------------------------------------------------------

Sr Information Comments

1 Name of RRB with Sponsor Bank

2 A

2 B

Total number of KCC account holders

Total number of KCC account holders with Rupay

ATM cards

3 Total number of transactions on these KCC Rupay

cards

4 Total payment made by the RRB as Inter-change

charges

(Information on Off-Us transactions should be submitted in the

form of a report generated from CBS.)

5 Amount claimed @ 80% or100% of 4 above

Certified that the above claim is based upon CBS data and is in order.

Chairman / Chairperson

Regional Rural Bank

17

Format for submitting KCC proposal - Cooperative Banks

-------------------------------------------------------------------------------------------------------------

Ref. No: Date:

The Chief General Manager, NABARD,

...............................…….. Regional Office

Dear Sir,

Proposal for assistance under FITF for Rupay KCC cards, Micro ATMs & other related

operational expenditure

We hereby submit a project seeking Grant Assistance under prevailing guidelines of FITF.

1. Technical details of the bank are as under :

a) Implementation date of CBS in the bank: ………………………….

b) No of bank branches on CBS: ………………………….

c) Name of CBS vendor: ………………………….

d) CBS Model (Ownership/Sponsorship): ………………………….

e) Name of the Sponsor bank (ATM services): ………………………….

f) Name of the Technical Service Provider (TSP) for ATM&POS network: ………..

g) Name of vendor & model number of the Micro ATMs being purchased : ……………

2. NPCI has allotted the following IIN number(s) to our bank :

a. IIN for RuPay Aadhaar Kisan Card is : ……………………………

b. IIN for RuPay without Aadhaar Kisan Card is : …………………………….

We confirm that :

a. The bank’s Board has approved undertaking of this project in its ….. Board Meeting

held on …………….. .

18

b. The designs of both Aadhaar & Non-Aadhaar cards have been approved by NPCI.

c. We have issued instructions to our branches to open Aadhaar based Accounts and

updation of existing Accounts with Aadhaar No. wherever Aadhaar No or Aadhaar

Enrolment No. is available.

d. Micro ATM devices complying with UIDAI 1.5 standards and any subsequent

modifications thereafter will be purchased.

3. In this connection the following information relating to project particulars along with

respective costs is being submitted :

Sr. Details of support Number Amount

1 Number of KCC accounts in the bank NA

2 Number and cost of KCC Rupay ATM cards @ ` .. each

3 Number of Micro ATMs owned by the bank to be

employed with PACS @ `…. each.

With PACS / branches

Upto 10% additional back up machines

4 Cost of Micro ATM - CBS integration (*)

5 Inter-change fees paid on Rupay KCC card transactions on

re-imbursement basis (**)

6 ATM Add on support

Cost per branch per month on ASP model OR

One time cost per branch for 3 years in Ownership model

7 Switching Fee ( For Cooperatives on Sponsorship model

for joining NFS (***)

(*)Cost details as agreed between service provider and the bank required to be submitted

along with the project.

(**) Interchange fees paid by the bank will be submitted for re-imbursement by NABARD

along with a CBS generated file clearly showing Rupay KCC transactions.

(***) System generated details of the Switching Fee charges, supported by NABARD on a re-

imbursement basis, will be provided by the bank along with the claim.

We also confirm that the above Rupay KCC cards will be issued by …….. and Micro ATMs will

be operationalized by ……… .

Yours Faithfully

Chairman /General Manager

FREQUENTLY ASKED QUESTIONS

19

FREQUENTLY ASKED QUESTIONS

FOR BANKS

20

1. What are the Mission, Vision and Objectives of National Payments Corporation of

India?

Mission: To build state of the art world class customer friendly electronic retail payment

system available and affordable by all, round the clock

Vision: Anywhere Anytime payment services which are –

(a) Simple and easy to use

(b) Safe and secure

(c) Fast and cost effective

Objectives: To integrate and consolidate all retail payment systems such that they are:

(a) Inclusive

(b) Customer friendly

(c) Varied yet simple

(d) Universally accessible

(e) Available round the clock

(f) Affordable to all

(g) Fully automated

(h) World class

2. Why was “RuPay” conceptualized?

The need for a domestic payment card “RuPay” card is on account of two factors: (a) the

high cost borne by the Indian banks for affiliation with international card associations in

the absence of a domestic price setter and (b) the connection with international card

associations resulting in the need for routing even domestic transactions, which account

for more than 95% of the total, through a switch located outside the country.

3. Advantages of RuPay over Visa and Master Cards

RuPay, which aims at promoting financial inclusion, is set to rewrite the rules of the

electronic payment system in India. Unlike Visa and MasterCard networks, it does not

charge an entry fee. RuPay has come as a boon not just for the rural and semi-urban

population but also for customers in metros.The need for RuPay is on account of the high

cost borne by Indian banks for affiliation with international card associations in the

absence of a domestic price setter. RuPay is pin supported, which makes it more secure

against fraud.

21

4. Is “RuPay” approved by the RBI?

NPCI has been granted approval to launch the "RuPay" affiliated cards for use at ATMs

and Micro ATMs. NPCI has been advised to ensure that the use of the RuPay Aadhaar

cards under the Aadhaar Enabled Payment System (AEPS) is in strict compliance with the

DBOD guidelines on Business Correspondents (BCs).

5. What are the main features of a RuPay card?

• RuPay is well equipped to handle both the single message and dual messaging

systems.

• RuPay is a Pin based product so it provides enhanced security

• It offers complete web based architecture, so member banks will not have to

develop a file based interface.

• RuPay provides advanced features such as processing of adjustment file to enable

Tip and Surcharge processing on the SMS platform too.

• Administration costs & quarterly charges are very low when compared to current

international schemes and there is no entry fee.

6. How many variants of the RuPay Cards are available?

As of now there are three variants of RuPay Cards.

(a) RuPay Debit Card

(b) RuPay Kisan Card

(c) RuPay Aadhaar Card

7. Where can a customer use the RuPay DebitCard?

The RuPay Debitcard can be used at any of the 1,00,000+ ATMs under the NFS network

and 1,00,000+ PoS machines at various Merchant establishments.

8. What are the services presently available for the RuPay Debit Card?

The following services are available on the RuPay Debit Card currently:

(a) Cash withdrawal

(b) Balance enquiry

(c) PIN Change

(d) Mini Statement

(e) Purchase at Merchant Establishments

(f) Cash at POS

22

9. What is NFS?

The National Financial Switch (NFS) maintained by NPCI provides national level ATM

switching network. It is the largest Multilateral Shared ATM Network in the country.

10. How can a Bank become a member of NFS?

There are 2 methods by which a bank can become a member of NFS: Direct member &

Sub-member. The various criteria for each are given below.

Criteria Direct member Sub-member

CBS Implementation Yes Yes

EFT switch Yes/Can be on shared

basis

Yes/Can be through

Sponsor bank/ASP

Networked ATMs Yes No

Connectivity to NPCI Yes/Can be on shared

basis

No/Can be through ASP

RTGS Member Yes No/Can be through

Sponsor Bank

Current account with RBI Yes No

DR/PR site for Data Center Yes/Can be on shared

basis


Pin generation &

verification using HSM

Yes/Can be on shared

basis


HSM for Pin encryption &

decryption


basis


Mandatory Pin, CVV1,

Expiry date verification by

issuer

Yes Yes

Acquiring facility on your

switch


basis


Debit Card Management

System


basis


To carry out Clearing &

Settlements

Banks own responsibility Responsibilities can be

shared with Sponsor Bank

& ASP

Recon & Dispute

management



& ASP

Fraud and Risk

Management



& ASP

23

11. Regional Rural Banks are not members of the NFS network and most of the RRBs

have not deployed any ATMs of their own. Can they still issue the RuPay Card?

Yes. RRBs have to obtain an IIN from NPCI and under Sponsor Bank or ASP Sub member

model the RRB can start issuing RuPay Cards to its customers. Transactions will happen

as per the Sponsor Bank – RRB Model or Sub Member- ASP Model. The RRBs can also

come as Sub Member- ASP Model if the RRB is not using the infrastructure from its

sponsor Banks.

12. Should the RRB invest in any new IT infrastructure?

A linkage needs to be established between the RRB CBS and the Sponsor Bank switch.

Therefore no significant investments required.

13. How can a DCCB become a member of NFS and issue the RuPay Card?

DCCBs can join NFS under the Sponsorship Model as a sub-member. DCCBs have to

obtain an IIN from NPCI and underSponsor Bankmodel theDCCB can start issuing RuPay

Cards to its customers. Transactions will happen as per the Sponsor Bank Model. The

bankwill have an ASP(Application Service Provider)for using the shared switching

infrastructure & managing transactions.

14. Should the DCCB invest in any new IT infrastructure?

No significant investments are required as the bank will utilise the services and shared

infrastructure of an ASP (Application Service Provider).

15. What is the Sponsor Bank Model for RRB?

The salient features of the model are:

a. The Sponsor Bank must be a member of the NFS network i.e sponsor bank

should be a NFS member bank

b. The RRB customer will have cards having a unique IIN issued by NPCI for RuPay

Debit Cards.

c. This IIN is treated and updated as Sponsor Bank’s IIN in the NFS network

d. A linkage is established between RRB’s CBS and sponsor bank’s switch

24

e. NPCI will settle all RRB transactions with the Sponsor Bank as a part of the

consolidated settlement of the sponsor bank. It will be the responsibility of the

Sponsor Bank to settle the same with the RRB

f. The Sponsor Bank will refer to the NFS generated Issuer Activity reports and

other MIS to settle transactions under the specific RRB IIN number.

g. The Sponsor Bank will be responsible for DMS on behalf of the RRBs

16. What is the Sponsor Bank Model for DCCB?

The salient features of this model are:

h. The Sponsor Bank must be on NFS network i.e., sponsor bank should be a NFS

member bank

i. The DCCB customer will have cards having a unique IIN issued by NPCI for

RuPay Debit Cards.

j. The Co-op Banks have tie-ups with various ASP/TSPs who automate their inter-

branch network, establish ATMs & issue ATM cards. Since the investment and

expertise required to setup EFT switch infrastructure is huge, Co-op banks use a

shared EFT switch provided by an ASP.

k. ASP Switch drives ATMs of these banks.

l. A switch-to-switch tie-up between the NFS switch and ASP Switch to which

multiple co-op banks’ CBS are connected.

m. Since most co-op banks are not member of RTGS, a NFS Member Bank will be

the Settlement Banker / “Sponsor Bank” for these Co-op. Banks and this is

governed by the ‘Liquidity Manager’.

n. NPCI will settle all DCCB transactions with the Sponsor Bank as a part of the

consolidated settlement of the sponsor bank. It will be the responsibility of the

Sponsor Bank to settle the same with the DCCB.

o. The Sponsor Bank will refer to the NFS generated Issuer Activity reports and

other MIS to settle transactions under the specific DCCB IIN number i.e. for

doing recon.

p. The Sponsor Bank will be responsible for DMS on behalf of the DCCBs.

17. What is a Liquidity Manager?

The Liquidity Manager would be run in the NPCI’s data centre& works as a limit check for

approving/declining transactions of sub member Banks.. Sub-member (DCCB) will

maintain a required amount with the Sponsor Bank, which will be used to cover the

settlements that the Sponsor bank will do on the sub

float amount, the Sponsor Bank will assign a Bank Limit in the Liquidity Manager. Sponsor

Bank would inform NPCI to maintain the limits into the Liquidit

would do the same and confirm back to Sponsor Bank.

18. What happens in the case of an On Us transaction

25

settlements that the Sponsor bank will do on the sub-member’s behalf. Based on the


Bank would inform NPCI to maintain the limits into the Liquidity Manager and NPCI

would do the same and confirm back to Sponsor Bank.

in the case of an On Us transaction for RRBs?

member’s behalf. Based on the


y Manager and NPCI

a. Regional Rural Banks will issue cards to its customers which will carry the

Unique IIN Nos for RuPay Debit Cards issu

b. This IIN number will be updated by Sponsor Bank as its own IIN number.

The same will be updated by NFS in the network and will be treated as

sponsor bank’s IIN number.

c. Regional Rural Bank Customer having the RuPay card will transact at

Sponsor Bank ATM for a Withdrawal or Balance Inquiry.

d. The transactions done by Regional Rural Bank Customers on Sponsor Bank

ATM will be routed to sponsor bank switch from where it travels to the

RRB CBS for authentication and customer balance verification.

e. The relevant accept / decline message will travel all the way back from the

RRB CBS to Sponsor Bank switch and to the ATM for onward processing.

19. What happens in the case of an Off Us transaction

26

Regional Rural Banks will issue cards to its customers which will carry the

Unique IIN Nos for RuPay Debit Cards issued by NPCI

This IIN number will be updated by Sponsor Bank as its own IIN number.


sponsor bank’s IIN number.

Regional Rural Bank Customer having the RuPay card will transact at

ank ATM for a Withdrawal or Balance Inquiry.

The transactions done by Regional Rural Bank Customers on Sponsor Bank



levant accept / decline message will travel all the way back from the


What happens in the case of an Off Us transaction for RRBs?


This IIN number will be updated by Sponsor Bank as its own IIN number.


Regional Rural Bank Customer having the RuPay card will transact at

The transactions done by Regional Rural Bank Customers on Sponsor Bank



levant accept / decline message will travel all the way back from the


a. Regional Rural Banks will issue cards to its custo


b. This IIN number will be updated by Sponsor Bank as its own IIN number. The

same will be updated by NFS in the network and will be treated as sponsor

bank’s IIN number.

c. Regional Rural Bank Customer having the RuPay card will transact at Acquirer

Bank ATM for a Withdrawal or Balance Inquiry.

d. The transactions done by Regional Rural Bank Customers on Acquiring Bank

ATM will be routed to NFS through the NFS member bank (acquiring bank)

switch

e. NFS switch will recognize the RRB IIN as the sponsor bank IIN and rout it to

the sponsor bank switch from where it travels to the RRB CBS for

authentication and balance verification.

f. The relevant accept / decline message travels back from RRB CBS

bank switch to NFS and onwards to the acquirer bank switch and the

particular ATM for onward processing.

g. NFS switching charges will be as applicable

27



This IIN number will be updated by Sponsor Bank as its own IIN number. The


bank’s IIN number.

ural Bank Customer having the RuPay card will transact at Acquirer

Bank ATM for a Withdrawal or Balance Inquiry.

The transactions done by Regional Rural Bank Customers on Acquiring Bank


NFS switch will recognize the RRB IIN as the sponsor bank IIN and rout it to


authentication and balance verification.

The relevant accept / decline message travels back from RRB CBS


particular ATM for onward processing.

NFS switching charges will be as applicable

mers which will carry the

This IIN number will be updated by Sponsor Bank as its own IIN number. The


ural Bank Customer having the RuPay card will transact at Acquirer

The transactions done by Regional Rural Bank Customers on Acquiring Bank


NFS switch will recognize the RRB IIN as the sponsor bank IIN and rout it to


The relevant accept / decline message travels back from RRB CBS to sponsor


28

20. What is Sub Member- ASP Model for on-boarding the RRBs?

In this model RRB utilizes the services/infrastructure of an Application Service provider for

getting connected to NFS. Though the settlement in this model will be done by Sponsor

banks only the flow of the transactions in case of “Off-US” mode.

In “Sub- member ASP” Model it is important that ASP selected by RRB/Sponsor bank is

certified with NPCI.

In case of “On-Us” Transactions NFS will not come in play.

The transaction flow willbe same as Sponsor bank model as mentioned earlier except for

the case that sponsor bank switch will be replaced by ASP Switch and IIN will be updated

at NFS and ASP is RRB IIN rather than Sponsor bank IIN.

21. What is the system architecture for the entire transaction flow

1. DCCB issues “RuPay” cards to its customers, which will carry t

BIN. So Bank Customer having “RuPay” card is able to transact at any NFS

Member Bank ATM.

2. The transaction initiated by the customer at acquirer bank’s ATM will hit the

Acquirer bank’s switch. The Acquirer bank’s switch check for the ON

US transaction.

3. The switch will determine that the transaction is OFF US; it will rout the

transaction to NPCI switch.

4. On the basis of the IIN

the transaction to the respective issuer bank’s

authentication of the transaction. In case of

switch provider of the sub member bank. The transactions at NFS Member Bank

ATMs are first checked against availability of the

29

What is the system architecture for the entire transaction flow in Cooperatives

CCB issues “RuPay” cards to its customers, which will carry the bank’s unique

Bank Customer having “RuPay” card is able to transact at any NFS

The transaction initiated by the customer at acquirer bank’s ATM will hit the

Acquirer bank’s switch. The Acquirer bank’s switch check for the ON

The switch will determine that the transaction is OFF US; it will rout the

transaction to NPCI switch.

IIN number NPCI switch determines the issuer bank and send

the transaction to the respective issuer bank’s switch for the authorization and

authentication of the transaction. In case of Sponsor Bank Model it’s an ASP


ATMs are first checked against availability of the Sub-member BankL

in Cooperatives?

he bank’s unique

Bank Customer having “RuPay” card is able to transact at any NFS

The transaction initiated by the customer at acquirer bank’s ATM will hit the

Acquirer bank’s switch. The Acquirer bank’s switch check for the ON-US and OFF

The switch will determine that the transaction is OFF US; it will rout the

the issuer bank and sends

switch for the authorization and

Bank Model it’s an ASP


member BankLimit set on

30

the Liquidity Manager on NFS. Transactions are declined by NFS Switch if amount

exceeds DCCB’s available limit.

5. If there is sufficient “Bank Limit” available, the transaction is routed to the ASP

switch for the DCCB, which is further routed to DCCB’s CBS host for

authorization.

6. If there is sufficient “Customer Balance” then the transaction is approved/decline

and sent back to ASP Switch

7. ASP send the approved/decline transaction to NPCI switch.

8. NPCI switch further routs the transaction to acquirer bank’s switch.

9. On the basis of approved/decline by the issuer, the acquirer bank’s switch sends

the respective response code to the ATM and the ATM acts accordingly.

The NPCI switch is connected to sponsor banks for the Dispute Management, Recon and

settlement for the sub member banks.

22. What is the scope of testing of the existing Sponsor Bank switch of RRBs?

The Sponsor Bank needs to be connected to the CBS of its RRBs and needs to ensure that

authentication and balance verification transactions are successful.

23. Will the sponsor bank switch be certified after testing by NPCI / NFS?

It depends on a case to case basis. Usually, since the sponsor bank switch is already

connected to NFS no additional certification would be necessary.

24. How does settlement take place in this (Sponsor bank- RRB) model?

The Sponsor Bank will handle the settlements on behalf of its RRBs. The Sponsor Bank

and RRB can have an internal settlement mechanism mutually decided by both entities.

However for all practical purposes the Sponsor Bank indemnifies settlements on the NFS

network on behalf of its RRBs. The Sponsor Bank will check its Issuer / Acquirer activity

reports and other MIS received from NFS and settle its accounts accordingly with the

RRB at mutually decided intervals.

31

25. How does settlement take place in this (Sponsor bank – Cooperatives) model?

The Sponsor Bank will handle the settlements on behalf of its DCCBs. The Sponsor Bank

and DCCB can have an internal settlement mechanism mutually decided by both entities.

However for all practical purposes the Sponsor Bank indemnifies settlements on the NFS

network on behalf of its sub member bank. The Sponsor Bank will check its Issuer /

Acquirer activity reports and other MIS received from NFS and settle its accounts

accordingly with the DCCB at mutually decided intervals.

26. Who handles the Dispute Management in the Sponsor bank- RRB model?

The customer will lodge a complaint with the respective RRB. RRB in turn will forward

the complaint to NFS Member Bank (Sponsor Bank). The NFS Member Bank (Sponsor

Bank) already has a Dispute Management mechanism in place by virtue of being a part of

the NFS network. The Sponsor Bank will raise the dispute in its DMS using its existing

DMS ID. Complaint will be solved as per normal procedure &a solution will be provided to

sponsor bank which in turn will provide the same to the RRB within defined TAT. (All

present RBI Guidelines would be applicable

27. Who handles the Dispute Management in the Sponsor bank- Cooperatives model?

The customer will lodge a complaint with the respective DCCB. DCCB in turn will forward

the complaint to NFS Member Bank (Sponsor Bank). The NFS Member Bank (Sponsor

Bank) already has a Dispute Management mechanism in place by virtue of being a part of

the NFS network. The Sponsor Bank will raise the dispute in its DMS using its existing

DMS ID. Complaint will be solved as per normal procedure &a solution will be provided to

sponsor bank which in turn will provide the same to the DCCB within defined TAT. (All

present RBI Guidelines would be applicable)

28. Will the RRB get a dispute management ID?

Yes the RRBs will get a DMS ID under Sub member-ASP Model.

29. Will the DCCB get a dispute management ID?

Yes the DCCBs will get a DMS ID under Sponsor Bank Model.

30. What types of reports are given by the NPCI / NFS to the Sponsor Bank?

The regular settlement and DMS reports will be provided to the Sponsor Bank.

31. What types of reports are given by NPCI / NFS to the RRB/DCCB?

No additional reports are given to the RRB/DCCB.

32

32. What are the initial documents to be received to initiate the on-boarding of DCCB as

sub member?

The following documents will be required to be submitted:

• Sponsorship letter from the Sponsor bank introducing the DCCB as sub member

and the ASP.

• Approach paper from Sponsor Bank (if new)

• Approach paper from ASP (if new)

• Board resolution from Sponsor Bank for participation in the Sponsor Bank Model

of NFS (if new)

• Dully filled & attested Risk Checklist from the DCCB

• A copy of RBI license issued to DCCB

• Board Resolution from DCCB for becoming a sub-member

• Duly filled and attested Network compliance checklist from the DCCB

• Audited balance sheet of the DCCB for last 3 years

• A copy of CAMEL ratings of the DCCB

• Network Diagram between sub-member(DCCB)& ASP

• IIN Request form & Cover letter from DCCB

• Application for joining NFS as sub-member and annexure from DCCB

• Bank Information Sheet from the DCCB

33. What is the scope of different entities involved in a Sponsor Bank – Cooperative

Model?

NFS Sub-Member:

In ITM System, NFS Sub-Member needs to be clearly identified to link with Sponsor

Bank

Limits with respect to the Sub-Member need to informed by NFS Sponsor Bank to

NPCI to further capture into LM

Sub-Member needs to be tagged with an ASP

NFS Sub-Member can change the relationship with NFS Sponsor Bank and ASP

NFS Sub-Member would act as issuer and acquirer also.

Application Service Provider (ASP)

ASP Switch to be connected to NFS

Proper UAT for Network & Application Level testing to be done before they are put

into production system

Any transaction sent to ASP has to be routed through LM first and only successful

transaction would be then sent to ASP.

ASP would be certified by the 3rd Party SISA Auditor for IS related matters and their

compliance should be handled like any other connection in NFS.

ASP would be sponsored by the NFS Sponsor Bank.

33

Technical Certification for NFS connectivity would be done by NPCI.

ASP should be tagged with Sponsor Bank and Sub-Member in all reports of

DMS/ITM

NFS Member Bank (Sponsor)

NFS Sponsor Bank would be tagged to its NFS Sub-Member and ASP into ITM/DMS

Separate DMS report for net settlement and other reports to be generated for the

Sponsor Bank w.r.t Sub-Member.

Liquidity Manager Limits would be captured as per the request received from the

sponsor bank.

Separate DMS IDs to be created for Sponsor Bank to capture their DMS related

issues for the multiple Sub-Members.

Provide the technical support to Sub-Member and ASP

34. What is an IIN?

IIN stands for Issuer Identification Number, also known in general terminologies as Bank

Identification Number (BIN). The purpose of the numbering system is to uniquely identify

a card issuing institution in an international interchange environment. All IINs assigned

are six digit numbers and are the first six digits of a card.

35. What is the process involved when a RRB applies for an IIN?

The RRB should apply for an IIN in the prescribed IIN License Agreement form provided

by NPCI. The agreement form has to be duly signed by the designated authority of the

RRB, duly stamped with the RRB seal and sent to NPCI along with a covering letter from

the Sponsor Bank requesting issue of IIN to its RRB. Bank has to provide the Product

Type processing for its RRBs. i.e Single Messaging System (SMS) or Dual Messaging

System (DMS).

36. What is the process involved when a Cooperative applies for an IIN?

The DCCB should apply for an IIN in the prescribed IIN Request form provided by NPCI.

The agreement form has to be duly signed by the designated authority of the DCCB, duly

stamped with the seal and sent to NPCI along with a covering letter from the DCCB.

37. What is the cost of obtaining an IIN from NPCI?

NPCI has presently waived off the onetime IIN issuance fee, so currently IIN is issued free

of cost.

34

38. What is the time taken by NPCI to issue an IIN?

Two working days.

39. What are the compliance requirements to be followed for a NPCI issued IIN?

(a) The allotted IIN should be used exclusively for RuPay Branded Cards

(b) The cards issued under the IIN will be as per standards provided by NPCI (RuPay

Cards and Marks Specifications)

(c) The cards must be able to perform successful transactions on all NFS ATMs under

NFS network operating rules and regulations

(d) NFS operating guidelines and all circulars issued under NFS will be applicable for

the cards issued under the IIN

(e) The IIN will be valid only for the product applied for and any other product

variation(s) using the same IIN would require separate approvals.

40. Can a RRB/DCCB apply for more than one IIN?

Yes.

41. Can a single IIN issued by NPCI be used for RuPay Debit Card, RuPay Kisan card and

RuPay Aadhaar Card also? Or should the RRB/DCCB apply for a new IIN for the

same?

If RRB/DCCB has the capability of product differentiation at 7th

and 8th

Digit of card

number no separate IIN needs to be issued for Aadhaar Cards. But the bank needs to

inform the number series reserved for Aadhaar Card to NPCI. However separate IIN

will be issued on request for RuPay Debit and RuPay Kisan Card.

42. Can product variations be made using a single IIN? If so how?

It is advised that you structure your Customer Account Numbers (digits 7 to 15) in such a

way that you can reserve specific ranges of account numbers to identify future products,

services, technologies, or brands.

IIN fixed length

6 digits assigned by Registration

Authority

Customer Account Number assigned by card

issuer

(Variable up to 9 digits including any spaces)

Digits 7 - 15

Check

Digit

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

Figure 1 - Example of a Primary Account Number (without any spaces)

35

The PAN is comprised of three components:

• The IIN - used only to identify the issuing institution (first 6 digits)

• Customer Account Number - should be used to identify products, services, geographic

locations and technologies, in addition to identifying individual cardholders (7th

digit

up to the 15th

)

• Check Digit - used to check that the account number is valid (digit 16 or 19 depending

on the account number length).

The first 6 digits cannot be used for any identification other than to identify the issuer to

whom the IIN is registered. However, any of the next 9 digits can be used to identify

products, services, geographic locations and technologies.

43. What is the procedure related to IIN when the RRB undergoes amalgamation?

Post Amalgamation, a particular scenario has emerged wherein the merging entities have

been issued RuPay BINs and the new entity formed after the merger will require a new BIN to

be given under the new name. The merging entities have not issued any cards as yet and no

certification process has been initiated till date. Hence, to handle such a change, we propose

the following –

1. The old merging RRB entities will now be a part of the new RRB entity and the new RRB

may submit an IIN Surrender form for the old entities. This may be endorsed by the new

Sponsor Bank.

2. Such a letter to be accompanied by the Official Gazette Merger Notification of the Govt of

India and other circulars / notifications by NABARD / Sponsor Banks.

3. This is to intimate NPCI that the old IINs have not been used and surrendered to NPCI thus

obviating any future use of the same

4. The new RRB will submit fresh IIN application form to NPCI for issuance of the same for the

required product type. This has to be accompanied by a covering letter of the new Sponsor

Bank.

5. NPCI will issue a new IIN to the new RRB entity which will then send us the new card

designs and will undergo a certification process as per the existing norms of NPCI.

In short the actionable for the RRBs are as under –

RRB X RRB Y New RRB formed by

Merger of X & Y

New Sponsor Bank

NPCI issued IIN NPCI issued IIN New RRB must

surrender RRB X IIN

and RRB Y IIN as per

NPCI IIN release forms.

New RRB will apply for

a new IIN from NPCI

New Sponsor Bank

must endorse the

surrender form and

new IIN request form.

36

NPCI issued IIN NPCI not issued IIN New RRB must

surrender RRB X IIN as

per NPCI IIN release

forms. New RRB will

apply for a new IIN

from NPCI

New Sponsor Bank

must endorse the

surrender form and

new IIN request form

NPCI issued IIN

and card

design

approved by

NPCI and cards

ordered but

certification

pending

NPCI not issued IIN New RRB must

surrender the RRB X

IIN. Cards ordered

needs to be stopped /

scrapped as the cards

should have the New

RRB logo and New RRB

name. New RRB must

apply for new IIN and

go for fresh approval of

card designs with new

name and new logo

New Sponsor Bank

must endorse the

surrender form and

new IIN request form

NPCI issued

IIN, Card

design

approved,

Bank is Live

and cards

issued.

NPCI not issued IIN New RRB must submit

for reassignment of old

IIN under new name /

re-apply for a new IIN.

New RRB must re-issue

the cards already

issued in the field with

the new card design,

new RRB name and

new logo

New Sponsor Bank

must endorse the

same.

44. How many test cards are to be sent to NPCI?

Presently 30 test cards have to be sent.

45. What should the test cards contain? Do they need to have the artwork as well?

The test cards may or may not have the art work. White plastic cards also can be sent.

But the cards have to contain the dummy Primary Account Number and a PIN mailer.

46. Once the card design is finalized by the RRB/DCCB and its Sponsor Bank, is an

approval from NPCI needed?

Yes. The card specifications would have to be as per the NPCI RuPay Card Marks and

Specifications latest Version.

47. Does the Card production and design vendor need to be certified by NPCI?

Yes.

37

48. Are there any approved vendors for Card design & manufacture?

As on date the following vendors are approved by NPCI for card design & manufacture:

Sr

Name of the

Company

Service Provided

Contact Details

Card

Manufact

uring

Card

Personali

zation

1 Versatile Card

Technology

Yes Yes Sridhar T.S

Versatile Card Technology (P) Limited AC21,

SIDCO Industrial Estate 4th Main Road

Thirumudivakkam, Chennai-600 044

Tel: +91- 44-24781551.

Fax: +91-44-24781571

Mobile: +91-9840085206

E-mail: [email protected]

2 MCT Cards &

Technology

Yes Yes Rajesh Shet

MCT Cards & Technology Pvt.Ltd.

Plot No. 22 A, Shivalli Industrial Area,

Manipal, Karnataka - 576104

Tel: +91-820-2574826

Fax: +91-820-2574827

Mobile: +91-9845518223


3 DZ Card

(India) Pvt.

Ltd.

Yes Yes Shailesh Patel

DZ Card (India) Pvt Ltd

Tel: +91-124-4128888

Fax: +91-124-4128899

Mobile: +91-9871998994


4 M-Tech

Innovations

Ltd.

Yes Yes Kapil Gandhi

Plot No. 1/2, Rajiv Gandhi Infotech Park,

Phase I, Hinjewadi, Pune 411057

Phone:- +91-20- 22934880/22932080

Ext:-254

Tele Fax :- +91-20- 22933139

38

Mobile :- +91 98500 39631


5 Oberthur

Technologies

India Pvt. Ltd.

Yes Yes Atul Jain

Oberthur Technologies India Pvt. Ltd,

A – 201, Sec – 63

Noida – 201303 (U.P.)

Phone:- +91-9811142455


Priyanka Singh

Phone:- +91-9699333779


6 Madras

Security

Printers

Private

Limited

Yes Yes Johnny Vitkar

Head - Western Region, Madras Security

Printer Pvt Ltd.

72. T.H Road, Chennai 600 081

Phone:- +91-9987005829

E-mail:- [email protected]

7 Giesecke&De

vrient (G&D)

Yes Yes ShyamBalakrishnan

Sr. Sales Manager – MSMS

Commercial Bank

Giesecke&Devrient India Pvt. Ltd.

Plot No. 218, Block A, Okhla Industrial

Area, Phase I, New Delhi – 110 020

Mobile: +91 7738037483

mailto:[email protected]

8 CMS

InfosystemsP

vt Ltd.

No Yes Mr. Mokam Singh

Sr.Business Manager

CMS Info Systems Pvt. Ltd.

Silver Metropolis,11th Floor,

Western Express Highway,

Goregaon 'East', Mumbai - 400063.

Landline : 022-67553219

Mobile - 09619858787

Email Id: [email protected]

49. How to ascertain whether the existing vendor of the Bank is certified by NPCI?

Please contact NPCI for this information.

39

50. What if the vendor is not certified, can the vendor apply for a certification from

NPCI?

Yes.

51. Is there any specific design for RuPay Kisan Credit Card?

Yes, there is a standard design for the RuPay KCC card. In order to achieve uniformity in

the Kisan Credit Cards on a debit card platform, the Department of Financial Services,

Ministry of Finance have proposed a standardized card design to be used for all Kisan

Cards to be issued by all the Scheduled Commercial Banks, Cooperative banks and RRBs.

A sample is given below –

52. Once the card design is finalized by the DCCB and its Sponsor Bank, is an approval

from NPCI needed?

Yes. The card specifications would have to be as per the RuPay Card marks and

specifications.

53. What if the vendor is not certified, can the vendor apply for a certification from

NPCI?

Yes.

54. How many cards with final artwork, card design and personalization need to be

sent to NPCI?

Five, for our archives.

55. In the card numbering format, is the RRB/DCCB free to use the 7th

digit of the card

as per its product variations?

Yes.

56. Does the POS Service provider need to be certified by NPCI

Yes (Message format certification only).

40

57. Can you please share the list of PoS device vendors and PoS application vendors for

our reference?

Following are the main vendors for the PoS terminal in the Indian market:

• Verifone,

• Ingenico,

• PineLabs,

• Innoviti,

• PAX,

• M Swipe

• Easy Tap

Following are the Technical Service Providers for the PoS terminal application:

Sl. Name of TSP/TPP Regd. Address Board No.

1 ATOS

6TH Floor, A Wing, Prism

Tower, Mindspace, Link Road,

Malad West, Mumbai - 400064

Tel: +91 (22) 4042 4000

2 Prizm Payments Silver Metropolis‚

3rd Floor‚ Jai Coach Compound‚

Goregaon (E)‚

Mumbai-400063

Tel:+91 (22) 39541800

3 In Solutions

Global

6th Floor Palm Spring Above

Croma Link Road Malad (West)

Mumbai : 400064

Maharashtra ,India

Tel:(022) 67603200

4 FSS 502 A 5th Floor South Block

TIDEL IT Park 4 Canal Bank

Road Teramani

Chennai: 600113

Tamil Nadu, India.

Tel : (44) 22540251

22540261

5 OPUS Opus Software Solutions (P).

Ltd. Commerzone, 1st Floor,

Building No.4,

SamratAshoka Path,

Off Airport Road,

Yerwada, Pune- 411 006,

Maharashtra-India

Tel: +91 - 20 6627 2100/

3092 5100

41

6 Atom

Technologies Ltd.

FT Tower, CTS no: 256 & 257,

Suren Road, Chakala,

Andheri (East),

MUMBAI - 400 093

TEL+91 22 67698300

7 TCBIL Tata Communications

Plot # C-21 and C-36

Block G, Bandra Kurla Complex

Bandra (East), Mumbai 400098

Tel +91 22 66578765

8 Banktech 3rd floor, Sigma Chambers

1307,HAL 3rd Stage, Jeevan

Bhima Nagar Main Road,

Bangalore-560075

Tel:91-80-43574400

9 MRL Posnet MRL Posnet Pvt Ltd, No.134/62,

Greenways Road, Raja

Annamalai Puram, Chennai -

600028, Tamil Nadu, India

Tel:044 24955569

58. Does the Switch ASP Vendors need to be certified by NPCI ?

Yes. At Present there are nine (9) ASPs which are certified by NPCI. Sub –Member

coming from these mentioned ASP does not require two round of testing. Only one

round of UAT is required. No comfort Testing is required as already these ASPs are

certified.

1. FIS Solutions.

2. C-edge

3. Euronet Services

4. Sarvatra Technology

5. Thane JanataSahakari Bank

6. Shyamrao Co-operative Bank (Maximus and Narada Switch)

7. Saraswat Co-operative Bank

8. Finacus

9. E-Cosmos Solutions(Cosmos Bank)

59. What is the Service Code and which service code is applicable for RuPay Cards?

Service code is comprised of three digits. The first digit specifies the interchange rules,

the second specifies authorisation processing and the third specifies the range of

services. It is 520 at present for the RuPay Scheme

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First digit

1: International interchange

2: International interchange, use IC (chip) where feasible

5: National interchange only except under bilateral agreement

6: National interchange only except under bilateral agreement, use IC (chip) where

feasible

7: No interchange except under bilateral agreement (closed loop)

9: Test

Second digit

0: Normal

2: Contact issuer via online means

4: Contact issuer via online means except under bilateral agreement

Third digit

0: No restrictions, PIN required

1: No restrictions

2: Goods and services only (no cash)

3: ATM only, PIN required

4: Cash only

5: Goods and services only (no cash), PIN required

6: No restrictions, use PIN where feasible

7: Goods and services only (no cash), use PIN where feasible

60. Is the card holder name mandatory on the RuPay Card?

Yes.

61. What is the manufacture ID code? Where on the Card layout should the

manufacture ID code be placed?

Please see the card reverse lay out below for placement of the manufacture code.

43

62. What are the costs involved in launching the RuPay Card?

For the Sponsor Bank –

(a) One time participation fees of Rs. 6 lakhs plus Service Tax

For the DCCB-

(b) Costs towards switch sharing with the ASP/Sponsor Bank

(c) Cost of card production, personalization and issuance

(d) Rs. 0. 50 per transaction towards NFS switching charges in case of Off-Us

transactions

Savings on Costs vis-a-vis International Card Schemes

(a) No certification fees

(b) No fees on value and volume of transactions

(c) No assessment fees

(d) No brand usage or royalty fees

(e) No network participation fees except the switching charges of NFS.

63. What about the interchange costs?

It may be noted that Interbank Interchange Fee (Decided by banks mutually) will be

applicable for Off-us ATM transactions. NPCI has no role to play in these fees. NPCI

merely recovers the interchange from issuers and pay the same to the acquirers. The

present interchange rates applicable are as under:

Financial Transactions: Rs. 15/-(per txn)+Service Tax

44

Non-Financial Transactions: Rs. 5/-(pertxn)+Service Tax

64. What are the different steps involved in issuing the RuPay Card?

Steps Activity Responsibility Timelines

(working days)

Step 1 Kick-off discussion with DCCB & ASP DCCB 1 day

Step 2 Receiving the initial set of

documents

Sponsor Bank &

DCCB

10 days

Step 3 Sub-member On-boarding Risk

Compliance

DCCB & NPCI 10 days

Step 4 DCCB to submit application to NPCI

for IIN assignment

DCCB 2 days

Step 5 Issuance of IIN NPCI 2 days

Step 6 Card creative & collateral

preparation and approval

DCCB 7 days

Step 7 Submission of card design by bank

and approval from NPCI

NPCI & DCCB 7 days

Step 8 DCCB to advise the card printing

vendor (certified by NPCI)

DCCB 7 days

Step 9 Submission of embosser file with

CVD values and track 1 & 2 data

DCCB 2 days

Step 10 Validation of the CVD values and

track data

NPCI 3 days

Step 11 Bank to submit30 test card plastics

& test cases with NPCI

DCCB 7 days

Step 12 NPCI to conduct testing &

certification

NPCI & DCCB/ASP 30 days

Step 13 Bank and NPCI to sign off on testing NPCI, Sponsor Bank,

DCCB

2 days

Step 14 Go Live Approval NPCI, DCCB, Sponsor

Bank

TBD

RuPay Aadhaar Card

1. Where can a customer use the RuPay Aadhaar Card?

The RuPay Aadhaar Card can be used at any ATM of any bank with PIN authentication and at

any Micro ATM with biometric fingerprint authentication.

To know more about the RuPay Aadhaar cards please visit

http://www.npci.org.in/AEPSOverview.aspx

2. What are the services available for the RuPay Aadhaar Card ?

45

(a) Cash withdrawal

(b) Cash deposit

(c) PIN Change

(d) Balance enquiry

(e) Aadhaar to Aadhaar Fund transfer

3. Can the customers get the Direct benefits transfer?

Yes, if the bank enrols in the Aadhaar Payment Bridge solution then EBT credit

disbursements can be done based on the UID Aadhaar number

4. In the RuPay Aadhaar Card where is the Aadhaar Number stored?

The Aadhaar number is stored in the track 1 discretionary data of the magstripe. The 12

digit Aadhaar number of the customer should start from the 59th

digit with the character

“A” as prefix.

5. Is the Aadhaar Number mandatory on the RuPay Aadhaar Card?

No. As per RuPay Card marks specifications the 4th

line embossing should be the UID /

Aadhaar Number. But this is optional and depends on the discretion of the individual banks

6. In the RuPay Aadhaar Card layout is the photograph of the card holder mandatory?

No. It is optional.

For any further queries and assistance ,do call us on the below mentioned numbers:

Name Designation Contact Numbers Email ids

Mr. Anupam Bagchi Chief Manager 8108186551 [email protected]

Mr. V. Ratnakar Senior Manager 8108108685 V. Ratnakar @npci.org.in

Mr. Ashish Bhan Manager 8879772702 [email protected]

Ms Nivedita Nayak Manager 8879772716

[email protected]

Ms Kumari Komal Assistant Manager 8108122832 [email protected]

National Payments Corporation of India ,13th

Floor , R-Tech Park ,South Side, Nirlon

Knowledge Park, Off Western Express Highway,Goregaon(E),Mumbai - 400063

46

Glossary of common words and acronyms in card based transactions

Acceptor: Any trading or service establishment that accepts transactions, on its own behalf or

on behalf of its network, for the payment of goods or services via an electronic money

instrument.

Acceptance for settlement: The stage in the processing of a payment at which it has passed all

risk management and other tests and can be settled under the system’s rules and procedures.

Acquirer: The entity or entities that hold(s) deposit accounts for card acceptors (merchants)

and to which the card acceptor transmits the data relating to the transaction. The acquirer is

responsible for the Collection of transaction information and settlement with the acceptors.

This is the bank on whose ATM other bank’s customer do the transactions.

ACH: Automated clearing house

ASP (Application Service Provider): It is a third-party entity that manages and distributes

software-based services and solutions to customers across a wide area network from a central

data centre. The need for ASPs has evolved from the increasing costs of specialized, complex

and capital intensive software.

ATM: Automated teller machine. An electromechanical device that permits authorized users,

typically using machine-readable plastic cards, to withdraw cash from their accounts and/or

access other services, such as balance enquiries, transfer of funds or acceptance of deposits.

ATMs may be operated either online with real-time access to an authorization database or

offline.

Batch: The transmission or processing of a group of payment orders and/or securities transfer

instructions as a set at discrete intervals of time.

47

Biometric: Refers to a method of identifying the holder of a device by measuring a unique

physical characteristic of the holder, eg by fingerprint matching, voice recognition or retinal

scan.

Brown Label ATMs : 'Brown label' ATM are those Automated Teller Machines where hardware

and the lease of the ATM machine is owned by a service provider, but cash management and

connectivity to banking networks is provided by a sponsor bank whose brand is used on the

ATM. The `brown label' has come up as an alternative between bank-owned ATMs and 'white

label' ATMs.

Card-based products: Electronic money products which provide the customer with a portable,

specialized computer device, typically a Smartcard card containing a microprocessor chip.

Cash card: Card for use only in ATMs or cash dispensers (other cards often have a cash function

that permits the holder to withdraw cash).

Cash dispenser: Electromechanical device that permits consumers, typically using machine-

readable plastic cards, to withdraw banknotes (currency) and, in some cases, coins.

CBS: Core Banking Solution

CBS on ASP MODEL: When the hardware and software licenses pertaining to CBS is owned and

maintained by an outside agency (Application Service provider) then, it is said to be CBS on ASP

Model.

CBS on OWNERSHIP: When the hardware and software licenses pertaining to CBS is owned by

the bank¸ it is said to be CBS on Ownership Model

48

Chip card: Also known as an IC (integrated circuit) card. A card containing one or more

computer chips or integrated circuits for identification, data storage or special purpose

processing used to validate personal identification numbers (PINs), authorize purchases, verify

account balances and store personal records. In some cases, the memory in the card is updated

every time the card is used (e.g. an account balance is updated).

Clearing: Clearing is referred to the movement of DMS transactions information from the member to

NPCI network and NPCI network to members.

Contact cards: Cards that require physical contact through an electronic connection surface

between the card and the card reader or terminal device.

Contactless cards: Cards that do not require physical contact between the card and the card

reader or terminal

Credit card: A card indicating that the holder has been granted a line of credit. It enables the

holder to make purchases and/or withdraw cash up to a prearranged ceiling; the credit granted

can be settled in full by the end of a specified period or can be settled in part, with the balance

taken as extended credit. Interest is charged on the amount of any extended credit and the

holder is sometimes charged an annual fee.

Debit card: Card enabling the holder to have his purchases directly charged to funds on his

account at a deposit-taking institution (may sometimes be combined with another function,

e.g. cash card or cheque guarantee card).

Delayed debit card: Card issued by banks indicating that the holder may charge his account up

to an authorized limit. It enables him to make purchases but does not offer extended credit, the

full amount of the debt incurred having to be settled at the end of a specified period. The

holder is usually charged an annual fee

49

DMS (Dispute Management System): This is the grievance redressal mechanism put in place to

resolve any customer complaints regarding cash withdrawals at ATM. All present RBI guidelines

would be applicable.

DMS Platform: A dual message system comprises of authorization, clearing and settlement. A

separate clearing message need to be submitted & the authorisation amount and settlement

amount can be different.

Electronic purse: A reloadable multipurpose prepaid card which may be used for small retail or

other payments instead of coins

Electronic wallet: A computer device used in some electronic money systems which can contain

an IC card or in which IC cards can be inserted and which may perform more functions than an

IC card.

Embedding: In IC card manufacturing, the process by which the chip module is mounted on the

plastic carrier (card).

HSM: Hardware Security Module. Its main function is to manage digital keys. HSMs provide

both logical and physical protection for the sensitive data from non-authorized use and

potential adversaries

IDRBT (Institute of Development and Research in Banking Technology): IDRBT is a banking

research institute, established in 1996 by Reserve Bank of India (RBI). IDBRT has set up National

Financial Switch in 2004. It was handling all the payment authentications until 2009, before

transferring it to National Payments Corporation of India. It has also developed common and

interoperable standards for all banks in the country.

50

Interchange: This is the fee that is paid by the card-issuing bank to the acquiring bank (for the

maintenance of the machine) for allowing its customers to do transactions at the other bank’s

ATM.

Interoperability: A situation in which payment instruments belonging to a given scheme may be

used in other countries and in systems installed by other schemes. Interoperability requires

technical compatibility between systems, but can only take effect where commercial

agreements have been concluded between the schemes concerned.

Issuer: This is the bank which issues the card to the customer.

Micro ATM: It is a POS device with a biometric reader used for doing Aadhaar enabled

transactions.

Multifunctional cards: A card which, in addition to a stored value card functions may include

other payment facilities such as a debit or credit card function and/or non-payment facilities.

NFS: National Financial Switch. Maintained by NPCI, this switch basically is the clearing platform

for all ATM based transactions across the country. All ATM networks in the country are linked

with NFS in India.

NPCI (National Payment Corporation of India): NPCI is a “not for profit” entity formed in 2009.

It is an Umbrella organization for all retail payment systems in India. NPCI is promoted by 10

commercial banks under the aegis of the IBA and guidance of RBI.

Offline: In the context of payment and settlement systems, the term may refer to the

transmission of transfer instructions by users, through such means as voice, written or

telefaxed instructions, that must subsequently be input into a transfer processing system. The

51

term may also refer to the storage of data by the transfer processing system on media such as

magnetic tape or disk such that the user may not have direct and immediate access to the data.

Off Us Transactions : A card transaction in which issuer and the acquirer are separate entities is

an OFFUS transaction. For offus transactions, authorization will be routed through the NPCI

network. NPCI will perform the clearing & settlement for both the members (Issuer & Acquirer).

Online : In the context of payment and settlement systems, this term may refer to the

transmission of instructions by users, through such electronic means as computer-to-computer

interfaces or electronic terminals, that are entered into a transfer processing system by

automated means. The term may also refer to the storage of data by a transfer processing

system on a computer database such that the user has direct access to the data (frequently in

real time) through input/output devices such as terminals.

On Us Transactions: A card transaction in which issuer and the acquirer is from the same

institution is an On Us transaction.

PIN (Personal Identification Number): A numeric code which the cardholder may need to

quote for verification of identity. In electronic transactions, it is seen as the equivalent of a

signature.

Presentment: It is a message where the acquirer presents transaction data to the issuer for

claiming the funds. A Clearing Record that an Acquirer presents to an Issuer through NPCI.

PoS ( Point of Sale): Device used for purchase transactions at merchant locations.

Server: a computer that provides services through a network to other computers.

Settlement: Settlement is the process used to exchange funds between members

52

Scheme Code: It defines the scheme from which the card belongs for example

Visa/Master/RuPay/Domestic Routing. Operating rules will be governed by the scheme code.

Smartcard: A plastic card in which one or more integrated circuits are embedded. Also called

chip card.

SMS Platform: Single Message System (SMS) environment uses a single exchange of messages between

the acquirer and the issuer to (a) Authorize a financial transaction (b) Post a financial transaction to a

cardholder’s account. It will perform real time transaction processing as well as exception or offline

transaction processing offline.

Sponsor Bank: The primary bank which sponsors another bank for joining the National Financial

Switch (NFS). The Sponsor Bank is already a member of the NFS.

Switch: A hardware device that connects multiple computers together.

Switching: Means routing of interbank ATM and POS transactions through a shared network.

Switch fee: Transaction fee set by the ASP and paid by the card issuing institution to the ASP

for the cost of routing transaction information.

TAT (Turn Around Time): Timelines fixed for the completion of a particular activity

Transaction: The act between a cardholder and a merchant or an acquirer that results in the

generation of a transaction Receipt or transaction log.

UID 1.5 / IBA-IDRBT Standards : These standards, which specify functional, hardware and

Interoperability requirements have been enforced to bring a uniformity in micro ATMs being

used in the country today. The overall objective is to allow each micro ATM to provide

53

standardized bio metric transactions. All micro ATMs used by the banks in the country have to

comply with these standards.

UIDAI (Unique Identification Authority of India): UIDAI aims to provide identification (Aadhaar

number) for each resident across the country which would be used primarily as the basis for

efficient delivery of welfare services. It would also act as a tool for effective monitoring of

various programs and schemes of the Government.

White Label ATMs: White Label ATMs (or WLAs) in India will be owned and operated by Non

Bank entities. A customer of any bank will be able to withdraw money from such White Label

ATMs but will need to pay a fee for the services. These WLAs will not display logo of any

particular bank and are likely to be located in non traditional place. With the expansion of ATM

network through WLA, customers will be able to withdraw funds at more locations, which will

be convenient and located near to their home or place of work. Banks too support introduction

of white label ATMs as such machines are likely to reduce pre-transaction cost for them and will

be free from the problems relating to maintaining and running such a payment channel.

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