Page 40 - Banking Finance January 2022

ARTICLE

SCOPE AND

OPPORTUNITIES

OF PAYMENT

BANKS IN INDIA

P ayment banks is a new Indian model of banks final report. Among its various recommendations, it

conceptualized by the Reserve Bank of India
recommended the formation of a new category of bank
called payments bank. On 17 July 2014, the RBI released
(RBI). These banks can accept a restricted
deposit, which is currently limited to Rs. 100,000
per customer and may be increased further. These banks the draft guidelines for payment banks, seeking comments
for interested entities and the general public. On 27
cannot issue loans and credit cards. Both current account November, RBI released the final guidelines for payment
and savings accounts can be operated by such banks. banks.
Payment banks can issue ATM cards or debit cards and
provide online or mobile banking. Advantages of Payment Banks:-

Y Reach: Traditional banks due to their structures and
Bharti Airtel set up India's first payments bank. On 23
business priorities they may be unable to cater to certain
September 2013, Committee on Comprehensive Financial
segments and geographies. But Payment Banks can
Services for Small Businesses and Low Income Households, reach every corner of the country due to its technology
headed by Nachiket Mor, was formed by the RBI. On 7
oriented services.
January 2014, the Nachiket Mor committee submitted its
Y Volume: Payment banks largely deal with low value,
high volume transactions like they can accept deposits
About the author of only up to Rs 1 lakh. So this low value transactions
will be very helpful to migrant workers and particularly
Amit Kumar Bhadani
Senior Manager women workers
STC Kolkata Y Complement: Payment banks themselves cannot offer
Union Bank of India certain services to customers, they can always partner

40 | 2022 | JANUARY | BANKING FINANCE