RBI wants banks to extend POS cash withdrawal facility
RBI issued a circular after it noticed that instructions in this regard were not being properly followed.
The Reserve Bank of India (RBI) asked banks to extend the facility of withdrawal of cash through debit cards at more merchant establishments. RBI issued a circular after it noticed that instructions in this regard were not being properly followed.
According to the prior instructions RBI had instructed to banks on cash withdrawal at POS (point of sale) devices enabled for all debit cards and open-loop prepaid cards issued by them. RBI mentioned in its circular that it has come to its notice that the instructions have not been implemented in "letter and spirit".
• For Tier I and II centres - cash withdrawal to Rs. 1000/- per day, and,
• For Tier III to VI centres - Rs. 2,000/- per day.
• Customer charges, if any, on such cash withdrawals to not more than 1% of the transaction amount.
• According to the RBI’s circular, prior instructions have not been implemented in letter and spirit.
• The central bank has said that the instructions issued in circulars are, therefore, reiterated with a view to provide for cash withdrawals at PoS by card-holders.
• Banks can decide the best way to deliver services, banks may extend the facility of withdrawal of cash at any merchant establishment designated by them after a due diligence process.
• Banks need to submit data on cash withdrawals at PoS devices within 15 days of the end of the quarter.
What is POS?
A point-of-sale transaction is called POS in short. A POS takes place between a merchant and a customer when a product or service is purchased. For example, whenever you are purchasing something and making a transaction, you are doing a point-of-sale (POS).
What is POS System?
POS system is a modern-day sale-purchase system; it doesn’t require cash registers anymore. An electronic system of sales record is known as the POS system. POS system comprises, POS terminal, credit/debit card reader, barcode scanner, receipt printer and cash drawer.