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RBI Tightens Domestic Money Transfer Rules for Cash Transactions

Current · Source: Reserve Bank of India · RBI/2024-25/52 · issued 24 Jul 2024 · ~1 min read

Quick answerRBI has revised the Domestic Money Transfer framework effective Nov 1, 2024. Key changes: cash pay-outs now require beneficiary name and address records; cash pay-ins need AFA, verified mobile, and OVD for remitters; and Card-to-Card transfers are excluded from DMT rules.

The rule, in the simplest words

From November 1, 2024, when a bank gives cash to someone receiving money, the bank must write down that person's name and address.
Before someone can send cash to another person, they must give the bank a real phone number and a valid ID (like a passport or driver's license).
Every time someone sends cash, the bank must check a second password or code (like an OTP) to make sure it's really them.
Sending money from one card to another card is no longer covered by these rules.

How it plays out — a real example

A branch operations officer in Indore helps a customer send ₹5,000 cash to her son in Mumbai. The officer first checks the customer's Aadhaar card and verifies her mobile number with an OTP. Then, before processing the transfer, the officer asks for another OTP sent to the customer's phone. Finally, the officer records the son's name and address in the system, ensuring the bank follows the new RBI rule.

What changed

RBI updated the 2011 DMT framework to address the growth in banking outlets and digital payment options. For cash pay-outs, remitting banks must now record the beneficiary's name and address. For cash pay-ins, remitters must register with a verified mobile number and a self-certified OVD, and every transaction requires AFA. Card-to-Card transfers are no longer under DMT rules.

What it means for you

Banks and BCs must enhance KYC and authentication for cash-based remittances, increasing compliance costs but reducing fraud risk. The exclusion of Card-to-Card transfers simplifies oversight for those instruments. Existing transaction limits remain unchanged, so operational adjustments are needed without altering core limits.

What you must do

Update systems to capture and store beneficiary name and address for all cash pay-out transactions by Nov 1, 2024.
Ensure remitter registration for cash pay-ins includes verified mobile number and self-certified OVD as per KYC Master Direction.
Implement AFA for every cash pay-in transaction by remitters.
Include remitter details and a cash-based remittance identifier in IMPS/NEFT messages for cash pay-ins.
Review and align cash pay-in processes with Income Tax Act provisions on cash deposits.

Who it affects

Authorised Payment System Operators, Banks (remitting and beneficiary), Business Correspondents, Non-bank participants in DMT

❓ Common questions

Regulatory timeline

Stated effective date effective Nov 1, 2024
Decoded by BankPulse 2026-06-18 03:05 IST

Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).

What is the effective date for these new DMT rules?

The circular comes into effect from November 1, 2024.

Are Card-to-Card transfers still covered under the DMT framework?

No, Card-to-Card transfers are now excluded and will be governed by separate guidelines or approvals.

Do the existing transaction limits from the 2011 circular still apply?

Yes, all other instructions from the October 5, 2011 circular, including transaction size limits, remain applicable.

📜 Read the original circular — full text as issued by RBI

RBI/2024-25/52
 CO.DPSS.POLC.No.S415/02.27.019/2024-25
 July 24, 2024
 The Chairman / Managing Director / Chief Executive Officer
 Authorised Payment System Operators / Participants (Banks and Non-banks)
 Madam / Dear Sir,
 Domestic Money Transfer – Review of Framework
 The framework for Domestic Money Transfer (DMT) was introduced in 2011, vide RBI circular DPSS.PD.CO.No.622/02.27.019/2011-2012 dated October 5, 2011 . There has been significant increase in the availability of banking outlets, developments in payment systems for funds transfers, and ease in fulfilling KYC requirements etc., since then; and now users have multiple digital options for funds transfer. A review was recently undertaken of various services facilitated in the current framework. Based on the review, the following changes are being made:
 a) Cash Pay-out Service 
 The remitting bank shall obtain and keep a record of the name and address of the beneficiary. b) Cash Pay-in Service 
 Remitting banks / Business Correspondents (BCs) shall register the remitter based on a verified cell phone number and a self-certified ‘Officially Valid Document (OVD)’ as per the Master Direction – Know Your Customer Direction 2016 , as amended from time to time.
 Every transaction by a remitter shall be validated by an Additional Factor of Authentication (AFA).
 Remitting banks and their BCs shall conform to provisions of the Income Tax Act, 1961 and the rules / regulations framed thereunder (as amended from time to time), pertaining to cash deposits.
 Remitter bank shall include remitter details as part of the IMPS / NEFT transaction message.
 The transaction message shall include an identifier to identify the fund transfer as a cash-based remittance.
 2. The guidelines on Card-to-Card transfer are excluded from the purview of the DMT framework and shall be governed under the guidelines / approvals granted for such instruments.
 3. All other instructions in the above circular dated October 5, 2011 including the limits in size of transactions shall continue to be applicable.
 4. This circular is issued under Section 18 read with Section 10 (2) of the Payment and Settlement Systems Act, 2007 (Act 51 of 2007), and shall come into effect from November 01, 2024.
 Yours faithfully,
 (Gunveer Singh)
 Chief General Manager-In-Charge

Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2024-25/52 · issued 24 Jul 2024. The plain-English explanation above is BankPulse’s own independent summary.

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Who does what — compliance checklist

💻 IT / Systems

Update systems to capture and store beneficiary name and address for all cash pay-out transactions by Nov 1, 2024.

📜 Compliance

Ensure remitter registration for cash pay-ins includes verified mobile number and self-certified OVD as per KYC Master Direction.
Implement AFA for every cash pay-in transaction by remitters.
Include remitter details and a cash-based remittance identifier in IMPS/NEFT messages for cash pay-ins.
Review and align cash pay-in processes with Income Tax Act provisions on cash deposits.

Grouped from the action items above — a single circular may involve more than one team.

Worked example & action-note template

Example: if you are an IT/Systems lead at a bank this circular applies to (Authorised Payment System Operators, Banks (remitting and beneficiary), Business Correspondents, Non-bank participants in DMT), your first concrete step on “RBI Tightens Domestic Money Transfer Rules for Cash Transactions” is: “Update systems to capture and store beneficiary name and address for all cash pay-out transactions by Nov 1, 2024.” (RBI issued this 24 Jul 2024).

Circular: RBI/2024-25/52 -- RBI Tightens Domestic Money Transfer Rules for Cash Transactions
Issued: 24 Jul 2024
Action required: Update systems to capture and store beneficiary name and address for all cash pay-out transactions by Nov 1, 2024.
Action required: Ensure remitter registration for cash pay-ins includes verified mobile number and self-certified OVD as per KYC Master Direction.
Action required: Implement AFA for every cash pay-in transaction by remitters.
Action required: Include remitter details and a cash-based remittance identifier in IMPS/NEFT messages for cash pay-ins.
Action required: Review and align cash pay-in processes with Income Tax Act provisions on cash deposits.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________

Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.

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BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly).
Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12707&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.