Overview

• On June 27 the RBI issued final directives under Section 18 and Section 10(2) of the Payment and Settlement Systems Act, 2007, set to take effect on January 1, 2026.
• Banks are required to apply rigorous due diligence when onboarding Aadhaar Enabled Payment System touchpoint operators.
• Operators inactive for more than three months must undergo fresh KYC before reactivation of their transaction capabilities.
• Institutions must maintain continuous risk-based monitoring and establish operational parameters based on factors such as location, transaction volume and velocity.
• Banks may adopt previously completed due diligence for agents onboarded as business correspondents or sub-agents to meet the new requirements.