The Reserve Bank of India (RBI) on 19 August 2015 granted in-principle approval to 11 payment banks applicants under the Guidelines for Licensing of Payments Banks. The guidelines were issued on 17 November 2014.
The 11 payment banks granted the approval includes
• Aditya Birla Nuvo Limited
• Airtel M Commerce Services Limited
• Cholamandalam Distribution Services Limited
• Department of Posts
• Fino PayTech Limited
• National Securities Depository Limited
• Reliance Industries Limited
• Shri Dilip Shantilal Shanghvi
• Shri Vijay Shekhar Sharma
• Tech Mahindra Limited
• Vodafone m-pesa Limited
RBI's “in-principle” nod will be valid for a period of 18 months, during which time the applicants have to comply with the requirements under the Guidelines and fulfill the other conditions as may be stipulated by the Reserve bank.
On being satisfied that the applicants have complied with the requisite conditions laid down by it as part of “in-principle” approval, the Reserve Bank would consider granting to them a licence for commencement of banking business under Section 22(1) of the Banking Regulation Act, 1949. Until a regular licence is issued, the applicants cannot undertake any banking business.
A payments bank differs from conventional banks as it cannot lend to its customers. It is allowed to take deposits, allow remittances and provide simple financial products. The payments bank will need to invest 75 percent of its funds in government securities.
The minimum capital needed to set up a payments bank is set at 100 crore rupees. The bank will be allowed to accept savings deposits of up to 1 lakh rupees from each customer.
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When: 19 August 2015