1
In Recent
th
News
On 19 August 2015, The Reserve Bank of
India gave “In-Principle” License to eleven
entities to launch payment bank. These are
:
1. National Securities Depository Limited
2. Reliance Industries
3. Aditya Birla Nuvo
4. Airtel M commerce
5. Department of Post
6. Fino Paytech
7. Tech Mahindra
8. Vodafone M - Pesa
9. Cholamandalam distribution Services
10. Paytm
11. Indian Department of Posts
2
What is Payment
Bank?
O These are new stripped
down type of banks ,
which are expected to
reach customers mainly
through their mobile
phones rather than
Otraditional bank to
They are allowed branches.
undertake
only certain restricted
banking functions that the
Banking Regulation Act of
1949 allows.
3
Structure Of Payments
Bank
Rs.100 Cr is the minimum capital
Maintain 75% of deposits on Govt. bonds
Maintain 25% of deposit in Other banks
Have a atleast 26% investment by
Indians Can only accept CASA deposit
Liability should not exceed 20 times of its net worth
Have 25% of branches in unbanked areas
4
Guidelines for Licensing of Payments
Bank
•Registration, Licensing and Regulation
•Objectives
•Eligible Promoters
•Scope of Activities
•Deployment of Fund
•Capital Requirement
•Promoters Contribution
•Foreign Shareholding
•Voting Rights and Transfers
•Prudential Norms
•Business Plan
•Corporate Governance
•Other Condition
Features Of Payments
Bank
Who Can How do they
Promote? earn?
Prepaid card
issuers, RBI allows these
Telecom bank to invest 75%
Companies, in govt. Secuirity
25% in other Bank
NBFC’s, Charged 1 or 2% on
Business normal cash transfer
No risk for losses on
correspondents, NPAs
Supermarket Play on Volume by
Chains, attach million of
customer
Corporates, 6
Realty sector
co- ops &
Features Of Payments
Bank Don
Do’ t’
s s
O 1 Lakh deposit in
one acc O Offer credit card
O Offer Internet O Extend Loan
Banking
O Sell Mutual Fund, O Handle cross
Insurencre, Pension Border Remittance
O Offer Bill Payment
services for O Accept NRI
customer deposit
O Have business
Correspondents
7
Birth of the
Concept
The payment bank cames into
existance as a result of Nochiketa
more Comitte
Officially known as “Committee on
comprehensive Financial services for Small
business and low Income House hold”
Formed by the RBI governopr raghuram
rajan on 23 sep-2013
This committee had submiytted its Report in
January 2014 and had recommended,
among other things, Setti9ng up of the small
bank and payment bank
8
Benefits They
offer
Service Charge will come down
No cap to maintain minimum Balance
RBI rate cut Benefit
Payment Banks may make handling
cash a lot easier
9
Growt
h
SBI will take off in 30% of RIL Proposed
Bank
Bharti Airtel India s largest telecom
operator plan to give 19.9% to Kotak
Mahindra Bank
Aditya Birla NUVO ltd has tied up with
Idea Cellular with 49% stake
10
Impact On the
Society
Need to introduce new product
and new Application
“Payments Bank
will change the
Increase their customer way people think,
Change the way
they keep the
Mobile phone transaction still money, where
has opportunity to penetrate they keep their
rural India with alternate money, the way
methods for transaction they pay”
11
Conclusi
on
These bank targeted those masses who
cannot afford to visit branch for carrying
out transactions by providing them basic
banking facilities through mobile platform
They will leverage the huge volume of
transactions
for gaining profit
They will face challenges like any other
venture but if successful , the payment
bank promise to change the banking
scenario in India and will allow the govt. to
achieve its goal of financial inclusion. They
will also offer competition to the
existing bank and more competition is good 12
for the economy as whole.
13
