The Reserve Bank of India (RBI) has introduced a consolidated set of rules governing domestic money transfers, bringing greater clarity to the framework for small-value fund transfers. Issued on Nov. 11, 2026, the Reserve Bank of India (Domestic Money Transfer) Directions, 2026, came into force immediately.
The new framework brings together and replaces earlier instructions issued by the central bank in 2011 and 2024.
Banks and other regulated entities involved in domestic money transfers will have to comply with the revised framework. Its coverage includes scheduled commercial banks, regional rural banks, cooperative banks, authorised payment system operators and their participants. Transfers made directly from one card to another have been kept outside the guidelines.
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The revised framework sets out the rules for domestic money transfers (DMT) made by individuals through approved banking channels. It covers transactions carried out through authorised banks, Business Correspondents (BCs) and automated teller machines (ATMs).
The facility is particularly relevant for migrant workers and people who have limited access to conventional banking services. The RBI has also updated regulatory references to reflect the KYC Directions, 2025, and the Income-tax Act, 2025, while keeping the existing transaction limits intact.
Key Transaction Limits and Services
The RBI has prescribed separate transaction limits for domestic money transfers involving cash payments and cash deposits.
Under the Cash Pay-Out Service, individuals can send money from their bank accounts to recipients who do not have an account and wish to collect the amount in cash. Each transfer is capped at Rs 10,000, while the total amount that can be sent to a particular beneficiary cannot exceed Rs 25,000 in a month. Banks facilitating these transactions must also record the recipient's name and address.
The Cash Pay-In Service caters to individuals who want to deposit money without holding a bank account themselves. Those using an ATM or business correspondent to send money to a beneficiary's account can deposit up to Rs 5,000 per transaction, subject to a monthly limit of Rs 25,000 per remitter.
Customers visiting a bank branch can use NEFT to transfer as much as Rs 50,000 in a single transaction.
Strict KYC and Security Safeguards
Stricter customer verification and transaction monitoring measures form part of the RBI's revised domestic money transfer framework. Anyone depositing cash through the pay-in facility will need to provide a verified mobile number and a self-attested Officially Valid Document (OVD) during registration. An Additional Factor of Authentication (AFA) will also be compulsory for every transaction.
The directions place responsibility on banks and non-bank operators to monitor transaction activity and identify irregular patterns. They must introduce velocity checks to detect sudden surges in credits to individual accounts. The provisions do not extend to card-to-card transfers.
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