Payments bank system in India
What are Payments Banks ?
Payment banks are those banks which are registered as a public limited company under the Companies Act, 2013, and licensed under Section 22 of the Banking Regulation Act, 1949, and its activities regarding these specific licensing conditions are restricted only to acceptance of demand deposits and provision of payments and remittance services.
So payment banks in India will be allowed to open current accounts and savings bank accounts with a deposits of up to a maximum of Rupees 1 lakh per customer. Where as they are eligible to issue debit cards and offer services like remittance and utility bill payments, along with this promotes and distribute simple financial products like insurance and mutual funds through channels like Internet, mobile banking, branches, and business correspondents.
Function of Payments Banks ?
( 1 ) Payments Banks can accepts deposits, offer payments and remittance services.
( 2 ) They are eligible to issue ATM cum Debit Cards .
( 3 ) Can functioning as Business Correspondent (BC) of other Nationalised banks offers those services which it cannot offer.
( 4 ) They can distributes products such as mutual funds and insurance policies.
( 5 ) Unlike and other nationalised bank they services are limited and so they can't offers loans to the customers.
( 6 ) In initial stage of this banking they are allowed only to hold a maximum of Rupees 1 lakhs per customer account.
( 7 ) The minimum paid up equity capital will be Rupees 100 crore.
Foreign shareholding in Payments Banks ?
The foreign shareholding in these banks would be as per the extant FDI policy.
How it will change the country financial sector and common man life ?
( 1 ) Being based on high end technology, they can reduce the public dependence on cash as they completely promote person-to-person electronic remittances.
( 2 ) Know your customers ( KYC ) norms are relaxed in terms of strictness so it is easy to open an account in these banks.
( 3 ) Payments of utility bills can be done through mobile phones, so no more ques for depositing the bills, for this purpose bank will open outlets in the big malls and grocers stores.
( 4 ) Children's living far from theirs house for study purpose can deposit their school or college fee through this payments banks via mobile.
( 5 ) Small business units with a working staffs of five to six people can operate the salary account of their staff in this banks rather than give cash as a salary.
( 6 ) Mobile will no more acts as a instrument for calling and chatting but will turn as a new avtar of a "BANK IN HAND".
( 7 ) No more tension of fake currency as all transaction will be done on mobile and Internet more safe and secure.
( 8 ) Money collected by these banks can be used in development of infrastructure of our country and its a move to bring bank direct at your door step.
Payment banks are those banks which are registered as a public limited company under the Companies Act, 2013, and licensed under Section 22 of the Banking Regulation Act, 1949, and its activities regarding these specific licensing conditions are restricted only to acceptance of demand deposits and provision of payments and remittance services.
So payment banks in India will be allowed to open current accounts and savings bank accounts with a deposits of up to a maximum of Rupees 1 lakh per customer. Where as they are eligible to issue debit cards and offer services like remittance and utility bill payments, along with this promotes and distribute simple financial products like insurance and mutual funds through channels like Internet, mobile banking, branches, and business correspondents.
Function of Payments Banks ?
( 1 ) Payments Banks can accepts deposits, offer payments and remittance services.
( 2 ) They are eligible to issue ATM cum Debit Cards .
( 3 ) Can functioning as Business Correspondent (BC) of other Nationalised banks offers those services which it cannot offer.
( 4 ) They can distributes products such as mutual funds and insurance policies.
( 5 ) Unlike and other nationalised bank they services are limited and so they can't offers loans to the customers.
( 6 ) In initial stage of this banking they are allowed only to hold a maximum of Rupees 1 lakhs per customer account.
( 7 ) The minimum paid up equity capital will be Rupees 100 crore.
Foreign shareholding in Payments Banks ?
The foreign shareholding in these banks would be as per the extant FDI policy.
How it will change the country financial sector and common man life ?
( 1 ) Being based on high end technology, they can reduce the public dependence on cash as they completely promote person-to-person electronic remittances.
( 2 ) Know your customers ( KYC ) norms are relaxed in terms of strictness so it is easy to open an account in these banks.
( 3 ) Payments of utility bills can be done through mobile phones, so no more ques for depositing the bills, for this purpose bank will open outlets in the big malls and grocers stores.
( 4 ) Children's living far from theirs house for study purpose can deposit their school or college fee through this payments banks via mobile.
( 5 ) Small business units with a working staffs of five to six people can operate the salary account of their staff in this banks rather than give cash as a salary.
( 6 ) Mobile will no more acts as a instrument for calling and chatting but will turn as a new avtar of a "BANK IN HAND".
( 7 ) No more tension of fake currency as all transaction will be done on mobile and Internet more safe and secure.
( 8 ) Money collected by these banks can be used in development of infrastructure of our country and its a move to bring bank direct at your door step.
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| Payments Banks |
