RBI eases rules for centre’s mobility card after limited success

The National Common Mobility Card (NCMC), offering seamless digital payments across multiple public transport systems in the country, has found limited adoption to date. But that may change now, thanks to regulatory latitude over use cases.

The Reserve Bank of India (RBI) has now allowed such cards to be issued with a limit of Rs 3,000 without any KYC. This will likely allow more such cards to be issued - and used.

“The new regulatory order on prepaid cards with no KYC should open up the space for more players and make it attractive,” said Ravi Goyal, managing director, AGS Transact.


Mumbai-based AGS Transact offers NCMC services in Bengaluru with RBL Bank. It runs Ongo-branded prepaid cards for this service.

“There are already around 200 million NCMC-enabled cards issued by 48 banks who are part of this system, but adoption has been limited,” a senior banker in the know told ET. “Commuters use closed loop cards for each of the cities in metro stations; very few actually have started using NCMC cards here.”

Unlike the closed loop system, which allows the customer to use a card only in a particular metro service, commuters can use an NCMC card for payments at metros, buses, road toll plazas and fuel stations. Eventually, commuter trains linking suburbs to big cities are also expected to be brought into the fold.

The idea behind NCMC was to replicate the success of Oyster cards in London and Octopus cards in HongKong. But unlike many developed economies, India has a very fragmented public transport system run by each state government. While the idea was novel, the speed of adoption and deployment was hitherto slow, with mobility payments tied to specific platforms.

However, the mobility payments space received a major blow recently after one of the important players - Paytm Payments Bank (PPBL) – was directed to stop basic banking services from March 15. This means that multiple metro companies working with PPBL for payment services must move to other players.

PPBL was offering services for Delhi Metro, Gujarat Metro and Goa Transport Corp.

It was also running digital payments at parking outlets at major airports and other large shopping malls. PPBL was one of the large players in both Fastag and NCMC payments.

Delhi Metro Switch

Delhi Metro (DMRC), one of the largest metro operators in the country, moved to Airtel Payments Bank, two people in the know told ET. They are also looking to work on a multi-bank model in the future, they said. Responding to ET, a DMRC spokesperson said that they will continue to promote NCMC. "At the backend Airtel Bank has already replaced Paytm Payments Bank," the spokesperson said.

Emailed queries to PPBL went unanswered.

Chennai Metro, which was initially working with State Bank of India, issued a fresh tender on March 6 looking for a new financial institution which can offer acquiring and issuing services for NCMC cards.

On February 23, the central bank updated its rules for such cards and said that NCMC enabled cards can be issued by banks and prepaid companies with a limit of Rs 3,000 without any KYC. These cards can only be used for transit payments. Once customers complete the KYC, they can use these cards as normal payment instruments.

AGS Transact has already issued around 40,000 cards through Bengaluru Metro.

“We are targeting to issue 2.5 million such cards in the next two years. We will also start cobranding these cards with popular brands to help in disbursal,” AGS’s Goyal said.

The first cobranded prepaid card issued by AGS Transact is with consumer brand Patanjali.