Updated 13 November 2026. A plain-language summary, not legal advice. Check the RBI text and your sponsor bank's instructions before you change your product.
Short answer: On 11 November 2026 the RBI issued the Reserve Bank of India (Domestic Money Transfer) Directions, 2026, effective immediately. They pull earlier DMT circulars into one rulebook. Limits stay largely the same: cash sent through a business correspondent (BC), ATM or similar channel is capped at ₹5,000 per transaction and ₹25,000 per remitter per month; walk-in cash at a bank branch can go via NEFT up to ₹50,000; and cash paid out to someone without a bank account is capped at ₹10,000 per transaction and ₹25,000 per beneficiary per month. Every transaction needs an additional factor of authentication, and banks and non-banks must run fraud checks such as velocity limits.
What the Directions are
The Directions (reference RBI/DPSS/2026-27/476) are issued under the Payment and Settlement Systems Act, 2007. They replace two older instructions: the 5 October 2011 circular on DMT relaxations and the 24 July 2024 circular reviewing the DMT framework. Details are summarised by TaxGuru and reported by Business Standard, which notes that the Directions largely consolidate existing rules rather than change limits. The official text is on the RBI notifications page.
Who it applies to
- Scheduled commercial banks, regional rural banks, and urban, state and district central co-operative banks.
- Authorised payment system operators and participants, bank and non-bank, to the extent they offer DMT services.
- Business correspondents and their agents, who must follow the same registration, authentication and safeguard rules as the bank they work for.
Card-to-card transfers are excluded and stay under their own rules.
Limits at a glance
| Service | Per transaction | Monthly cap |
|---|---|---|
| Cash pay-in at a bank branch (walk-in, via NEFT) | Up to ₹50,000 | Not specified in reports |
| Cash pay-in through BCs, ATMs, other channels | ₹5,000 | ₹25,000 per remitter |
| Cash pay-out to a beneficiary without a bank account | ₹10,000 | ₹25,000 per beneficiary |
KYC, authentication and data
- Remitter registration: a verified mobile number and a self-certified officially valid document (OVD), as per the RBI KYC Directions.
- Additional factor of authentication (AFA) for every transaction, typically an OTP to the registered mobile. Our post on RBI two-factor authentication rules covers AFA options.
- Beneficiary details: for cash pay-outs, the remitting bank records the beneficiary's name and address.
- Message tagging: NEFT and IMPS messages must carry the remitter's details and an identifier that marks the transfer as a cash-based remittance.
Fraud monitoring
Banks and non-banks must have safeguards including velocity checks and credit alerts to customers. Unusual spikes in credits to an account or a group of accounts must be investigated at once, and suspicious transactions reported. Transfers should be processed in real time or close to it, and inter-bank settlement must use RBI-approved payment systems. Banks and BCs must also follow the cash deposit provisions of the Income-tax Act, 2025.
What fintech and BC platforms should check
If you run a DMT, AePS or agent-network app on behalf of a bank, most of this should already be live. Use the Directions as an audit list:
- Limit engine: per-transaction and monthly caps per remitter (pay-in) and per beneficiary (pay-out), counted across all your agents, not per agent.
- Remitter onboarding: mobile OTP verification, OVD capture and self-certification, with records kept for audit.
- AFA on every transaction, with failure and retry logs.
- Beneficiary records for cash pay-outs: name and address stored with the transaction.
- Cash-remittance flag and remitter details in the NEFT/IMPS payload sent to the sponsor bank.
- Velocity rules and alerts: many small transfers to one account, many remitters paying one beneficiary, or a burst of credits to linked accounts should raise a case for review.
- Pricing and grievance: show charges before the customer confirms, and give a complaint channel. Complaints can be escalated under the RBI Integrated Ombudsman Scheme.
The RBI's separate cyber security directions for non-bank payment operators also apply to many of these platforms. See our summary of the November 2026 RBI cyber security rules for payment apps.
What this means for customers and shops
For a migrant worker sending cash home through a local agent, little changes: the ₹5,000 per transfer and ₹25,000 per month caps continue, and an OTP is needed each time. Shops that act as BC agents should keep their registers and OTP flows tidy, since banks are expected to watch unusual patterns closely.
Building a payments product?
Nextinera builds payment, payout and reconciliation systems with limit engines, audit logs and bank API integrations. See our fintech work, the payment automation case study, or book a free call.