wordpress blog stats
Connect with us

Hi, what are you looking for?

RBI working group recommends relaxing norms for payment banks

Photo showing an Airtel board atop a shop

A Reserve Bank of India (RBI) internal working group recommended that payments banks (PB) be allowed to convert to small finance banks (SFBs) after a period of three years of operations, the regulator said in a statement on November 20. This is a relaxation of norms set by the RBI in its on-tap licensing guidelines for SFBs, which stated that PBs could convert after completing five years of operations. The idea for PBs stems from an RBI discussion paper which stated that a differentiated licensing regime could brought in to develop and nurture specialised banks in niche areas. Thereafter, in 2014 the Nachiket Mor committee recommended that PBs be set up primarily to provide payment services and deposit products to small businesses and low-income households across the country. In 2015, the RBI gave in-principle approval to 11 entities to set up a PB. However, five years later only six of these entities continue to operate as PBs, including Paytm Payments Bank, Airtel Payments Bank, India Post Payments Bank, Fino Payments Bank, Jio Payments Bank and NSDL Payments Bank. While the minimum paid-up equity capital for PBs was fixed at ₹100 crore, the working group says that for converting to an SFB the PB must reach the ₹200 crore net-worth requirement "within 18 months of ‘in principle’ approval or date of commencement of operations, whichever is earlier." Further, the working group also recommended that SFBs and PBs should list equity shares on the stock exchanges within six years from the date…

Please subscribe/login to read the full story.
Written By

Reports on banking, payments, fintech and crypto-curencies. Additional reporting on media regulations, data protection and other areas.

Free Reads

News

As per a report, Apple has been testing its own large language model (LLM) since last year but its technology remains behind the AI...

News

Telecom companies are against a regulatory sandbox, as they think information revealed by businesses during the sandboxing process might be confidential should be out...

News

According to a statement, the executive body of the European Union had also sought internal documents on the risk assessments and mitigation measures for...

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.

Views

News

NPCI CEO Dilip Asbe recently said that what is not written in regulations is a no-go for fintech entities. But following this advice could...

News

Notably, Indus Appstore will allow app developers to use third-party billing systems for in-app billing without having to pay any commission to Indus, a...

News

The existing commission-based model, which companies like Uber and Ola have used for a long time and still stick to, has received criticism from...

News

Factors like Indus not charging developers any commission for in-app payments and antitrust orders issued by India's competition regulator against Google could contribute to...

News

Is open-sourcing of AI, and the use cases that come with it, a good starting point to discuss the responsibility and liability of AI?...

You May Also Like

News

Google has released a Google Travel Trends Report which states that branded budget hotel search queries grew 179% year over year (YOY) in India, in...

Advert

135 job openings in over 60 companies are listed at our free Digital and Mobile Job Board: If you’re looking for a job, or...

News

By Aroon Deep and Aditya Chunduru You’re reading it here first: Twitter has complied with government requests to censor 52 tweets that mostly criticised...

News

Rajesh Kumar* doesn’t have many enemies in life. But, Uber, for which he drives a cab everyday, is starting to look like one, he...

MediaNama is the premier source of information and analysis on Technology Policy in India. More about MediaNama, and contact information, here.

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ

Subscribe to our daily newsletter
Name:*
Your email address:*
*
Please enter all required fields Click to hide
Correct invalid entries Click to hide

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ