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Payments Bank is a new model of banks conceptualized by the Reserve Bank of India (RBI). These banks can accept a restricted deposit, which is currently limited to Rs.1 lakh per customer and may be increased further. These banks cannot issue loans and credit cards. Both current account and savings accounts can be operated by such banks. Payments banks can issue services like ATM cards, debit cards, net-banking, and mobile banking.
The Committee on Comprehensive Financial Services for Small Businesses and Low-Income Households, headed by Nachiket Mor, was formed by the RBI On 7 January 2014. Among its various recommendations, it recommended the formation of a new category of the bank called payments bank. On 17 July 2014, the RBI released the draft guidelines for payment banks, seeking comments from interested entities and the general public. On 27 November, RBI released the final guidelines for payments banks.
Facilities of Payments Bank:
- Acceptance of demand deposits, i.e., current deposits, and savings bank deposits from individuals, small businesses and other entities, as permitted. No NRI deposits should be accepted.
- Payments bank will initially be restricted to holding a maximum balance of Rs.1,00,000/- per individual customer.
- Issuance of ATM/Debit Cards. Payments banks. However, cannot issue Credit Cards.
- Payments and remittance services through various channels including branches, Automated Teller Machines (ATMs), Business Correspondents (BCs) and mobile banking
- Payments bank can accept remittances to be sent to or receive remittances from multiple banks under a payment mechanism approved by RBI, such as RTGS / NEFT / IMPS.
- The payments bank cannot undertake lending activities.
External Advisory Committee for evaluating Applications of Payments Banks:
The Committee was formed by Raghuram Rajan, Former Governor of RBI, on 4th February 2015.
- Chairman: Shri Nachiket M Mor, Director, Central Board of Reserve Bank of India
- Ms Roopa Kudva, former MD & CEO, CRISIL Limited
- Ms Shubhalakshmi Panse, former Chairman & Managing Director, Allahabad Bank
- Shri Deepak Phatak, Chair Professor, IIT Bombay
List of Approved Payments Banks:
There were 41 applicants for Payments Bank. But RBI has granted only 11 applicants to Open Payments Banks on 19th August 2015.
The Approved Applicants are given as below.
|Applicant Name||Bank Name||Launched||CEO||HQ||Interest|
|Airtel M Commerce Services Limited||Airtel||12/01/2017||Shashi Arora||New Delhi||7.25%|
|Department of Posts||India Post||30/01/2017||A.P.Singh||New Delhi||5.5%|
|Vijay Shekhar Sharma||PayTm||23/06/2017||Renu Satti||Noida||4%|
|Fino PayTech Limited||Fino||13/07/2017||Rishi Gupta||Mumbai||4%|
|Aditya Birla Nuvo Limited||Aditya Birla||22/02/2018||–||–||–|
|Reliance Industries Limited||Jio||03/04/2018||–||–||–|
|Cholamandalam Distribution Services Limited||Yet to be launched||–||–||–||–|
|National Securities Depository Limited||Yet to be launched||–||–||–||–|
|Shri Dilip Shantilal Shanghvi||Yet to be launched||–||–||–||–|
|Tech Mahindra Limited||Yet to be launched||–||–||–||–|
|Vodafone m-pesa Limited||Yet to be launched||–||–||–||–|