{"id":6412,"date":"2020-04-09T11:40:52","date_gmt":"2020-04-09T06:10:52","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=6412"},"modified":"2025-02-28T18:05:27","modified_gmt":"2025-02-28T12:35:27","slug":"complete-outlook-of-payment-bank-license-online-in-india","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/complete-outlook-of-payment-bank-license-online-in-india\/","title":{"rendered":"A Complete Outlook of Payment Bank License"},"content":{"rendered":"\n<p class=\"has-drop-cap\"><strong><em>In\nthe year 2013, the Reserve Bank of India (RBI) formed the concept of Payment\nBanks in India.<\/em><\/strong> Demonetization in\nIndia reorganized the economic system of India. Now the people are more\ninclined towards paperless transactions and use digital payment gateways. There\nwas a sudden boost in the use of mobile wallets, which were earlier outcasted\nby the people. <strong><em>The Payment Banks provide the platform for online payments\nin India. A Payment Bank License is needed to get started with payment\ngateways.<\/em><\/strong> In this article, we will discuss the procedure for obtaining\nthe Payment Bank License. &nbsp;&nbsp;&nbsp;<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/complete-outlook-of-payment-bank-license-online-in-india\/#What_is_the_Payment_Bank\" >What\nis the Payment Bank?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/complete-outlook-of-payment-bank-license-online-in-india\/#Which_Regulatory_Acts_regulate_the_Payment_Banks\" >Which\nRegulatory Acts regulate the Payment Banks?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/complete-outlook-of-payment-bank-license-online-in-india\/#Who_are_the_eligible_players_for_obtaining_Payment_Bank_License\" >Who\nare the eligible players for obtaining Payment Bank License?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/complete-outlook-of-payment-bank-license-online-in-india\/#What_are_the_key_characteristics_of_the_Payment_Bank\" >What\nare the key characteristics of the Payment Bank?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/corpbiz.io\/learning\/complete-outlook-of-payment-bank-license-online-in-india\/#What_are_the_guidelines_of_RBI_for_the_Payment_Bank_License\" >What\nare the guidelines of RBI for the Payment Bank License?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/corpbiz.io\/learning\/complete-outlook-of-payment-bank-license-online-in-india\/#What_is_the_additional_information_to_be_furnished_by_Payment_Bank\" >What\nis the additional information to be furnished by Payment Bank?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/corpbiz.io\/learning\/complete-outlook-of-payment-bank-license-online-in-india\/#_What_is_the_procedure_for_obtaining_the_Payment_Bank_License\" >&nbsp;What is the procedure for obtaining the\nPayment Bank License?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/corpbiz.io\/learning\/complete-outlook-of-payment-bank-license-online-in-india\/#What_are_the_advantages_of_the_Payment_Bank\" >What\nare the advantages of the Payment Bank?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/corpbiz.io\/learning\/complete-outlook-of-payment-bank-license-online-in-india\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_the_Payment_Bank\"><\/span>What\nis the Payment Bank?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>Payment Bank is set up under the guidelines for the Payment Bank License issued by<\/em><\/strong><em> <strong>Reserve Bank of India (RBI)<\/strong><\/em><sup><a href=\"https:\/\/www.rbi.org.in\/\"><strong>[1]<\/strong><\/a><\/sup><strong><em>. The Payment Bank is a micro-bank with limited banking functions. These Banks can receive a restrict deposit of up to 1 lakh Rupees per client.<\/em><\/strong> The RBI restricts the issue of credit cards and loans from the Payment Banks. However, these Banks can issue Debit Cards, ATM Cards, mobile-banking, and net-banking facilities. Both savings and current accounts can run under these banks. &nbsp;<\/p>\n\n\n\n<p>The main function\nof RBI is to have financial inclusion in India. The Payment Banks are set up to\nincrease the use of banking facilities by the people living in the remote areas\nof India. Payment Banks provide financial services through smartphones to\npeople all over the country. As sometimes, it is not economical for all the\nbanks to provide branches in all remote areas of the country, so to solve this,\nthe concept of Payment Banks is introduced.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Which_Regulatory_Acts_regulate_the_Payment_Banks\"><\/span>Which\nRegulatory Acts regulate the Payment Banks?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>The\nPayment Bank should get enrolled under the following Government Act and while\nissuing Payment bank License the compliance of the following Acts is also\nneeded:<\/em><\/strong><\/p>\n\n\n\n<ul>\n<li>The <strong><em>Companies Act, 2013<\/em><\/strong>;<\/li>\n\n\n\n<li>The <strong><em>Reserve bank of India, Act, 1934<\/em><\/strong>;<\/li>\n\n\n\n<li>The <strong><em>Banking Regulation Act, 1949<\/em><\/strong>;<\/li>\n\n\n\n<li>The <strong>Payment and Settlement Systems Act, 2007<\/strong>;<\/li>\n\n\n\n<li>The <strong>Foreign Exchange Management Act, 1999;<\/strong><\/li>\n\n\n\n<li><strong>The DICGC (Deposit Insurance and Credit Guarantee Corporation) Act, 1961<\/strong>.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Who_are_the_eligible_players_for_obtaining_Payment_Bank_License\"><\/span>Who\nare the eligible players for obtaining Payment Bank License?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>The\nReserve Bank of India (RBI) has provided a long list of eligible players for\nobtaining the Payment Bank License. The list of eligible players is as follows:<\/em><\/strong><\/p>\n\n\n\n<ul>\n<li>Companies (Public\nCompany); <\/li>\n\n\n\n<li>Mobile Telephone\nCompanies;<\/li>\n\n\n\n<li>The Supermarket Chains;<\/li>\n\n\n\n<li>The Non-Banking Finance\nCompanies (NBFCs);<\/li>\n\n\n\n<li>Corporate Business Correspondents\n(BCs);<\/li>\n\n\n\n<li>The existing issuers of\nnon-bank PPI (Prepaid Payment Instrument)<\/li>\n\n\n\n<li>Professionals\/Individuals<\/li>\n\n\n\n<li>The Real Sector\nCooperatives which are owned by Residents<\/li>\n\n\n\n<li>A promoter or group of\npromoters can have a Payment Bank License if they have a joint venture with an\nexisting scheduled commercial bank<\/li>\n\n\n\n<li>The Public Sector\nEntities&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_key_characteristics_of_the_Payment_Bank\"><\/span>What\nare the key characteristics of the Payment Bank?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>The key characteristics of Payment Banks are as follows:<\/em><\/strong><\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" width=\"586\" height=\"373\" src=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/04\/image-23.png\" alt=\"characteristics of Payment Bank\" class=\"wp-image-6413\" srcset=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/04\/image-23.png 586w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/04\/image-23-300x191.png 300w\" sizes=\"(max-width: 586px) 100vw, 586px\" \/><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\">Deposit of 1 lakh<\/h3>\n\n\n\n<ul>\n<li>The <strong><em>maximum deposit offered to Payment Bank is 1 lakh Rupees<\/em><\/strong> by the Reserve Bank of India (RBI).<\/li>\n\n\n\n<li>This limit on deposit with Payment Bank is there to safeguard the interest of customers.<\/li>\n\n\n\n<li>The Payment Bank also gives the leverage to deposit amount partially or wholly.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">No\nMinimum Account Balance Maintenance<\/h3>\n\n\n\n<ul>\n<li>Unlike conventional\nbanks, the customers of Payment Banks <strong><em>are not required to keep a<\/em><\/strong> <strong><em>minimum\nbalance in the account.<\/em><\/strong> The customers can even opt for a zero balance\naccount.&nbsp; <\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Availability\nof both Current and Savings Accounts<\/h3>\n\n\n\n<ul>\n<li>After obtaining the\nPayment Bank License, the Bank can offer <strong><em>both current and savings\naccounts.<\/em><\/strong><\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Physical\nand Virtual Debit Cards<\/h3>\n\n\n\n<ul>\n<li><strong><em>The Payment Bank also channelizes\nvirtual debit transactions apart from providing physical debit cards<\/em><\/strong>.\n<\/li>\n\n\n\n<li>There is no additional\ncharge for virtual debit, whereas an annual fee is charged from the customers\nfor using physical debit cards.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Online\nFund Transfers<\/h3>\n\n\n\n<ul>\n<li>Services such as <strong><em>IMPS, NEFT<\/em><\/strong> are provided to the customers by Payment Bank. These online services decrease the hassle of visiting financial institutions.  <\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_guidelines_of_RBI_for_the_Payment_Bank_License\"><\/span>What\nare the guidelines of RBI for the Payment Bank License?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>The\nguidelines provided by the Reserve Bank of India (RBI) are as follows:<\/em><\/strong><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Registration\nand License <\/h3>\n\n\n\n<ul>\n<li>The registration of\nPayment Bank will be done under <strong><em>the Companies Act, 2013.<\/em><\/strong> <\/li>\n\n\n\n<li>The License of Payment\nBank will be given under the <strong><em>Banking Regulations Act, 1949<\/em><\/strong>.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Eligible\nPromoters and Objectives <\/h3>\n\n\n\n<ul>\n<li>The primary objective\nof setting up Payment Bank will be <strong><em>financial inclusion<\/em><\/strong>. <\/li>\n\n\n\n<li>There will be certain\neligible promoters of the Payment Bank License.<\/li>\n\n\n\n<li>The Payment Bank will\nbe set up as <strong><em>differentiated banks and should confine its activities for\nfurthering the objectives for which it is set up.<\/em><\/strong><\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Deployment\nof Funds<\/h3>\n\n\n\n<ul>\n<li>The Payment Banks <strong><em>cannot\nundertake lending activities of funds.<\/em><\/strong> <\/li>\n\n\n\n<li>The Payment Banks have\nto maintain a <strong><em>cash reserve ratio with the Reserve Bank of India (RBI).<\/em><\/strong><\/li>\n\n\n\n<li>The <strong><em>Payment bank\nhas to invest 75% of its &#8216;demand deposit balances&#8217; in Statutory Liquidity Ratio\nin government securities\/treasury bills<\/em><\/strong>. <\/li>\n\n\n\n<li>The <strong><em>Payment Bank\nshould hold a maximum of 25% in fixed and current deposits with scheduled\ncommercial banks for liquidity management and operational purposes<\/em><\/strong>. &nbsp;&nbsp;&nbsp; <\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Capital\nRequirement<\/h3>\n\n\n\n<ul>\n<li>The minimum paid-up\ncapital of the Payment Bank <strong><em>should be 100 crore Rupees<\/em><\/strong>. <\/li>\n\n\n\n<li>The <strong><em>leverage\nratio of the Payment Bank should not be less than 3%. Hence, it can be said\nthat the outside liabilities should not exceed 33.33% of its paid-up capital\nand reserves<\/em><\/strong>. <\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Contribution\nof Promoter<\/h3>\n\n\n\n<ul>\n<li><strong><em>No maximum shareholding\nlimit<\/em><\/strong> is prescribed for promoters.<\/li>\n\n\n\n<li>The initial\ncontribution of promoters should be <strong><em>40% of the paid-up equity capital of\nthe Payment Banks for at least five years after the commencement of the\nbusiness.<\/em><\/strong>&nbsp;&nbsp; <\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Scope\nof Activities<\/h3>\n\n\n\n<ul>\n<li>The acceptance of\ndemand deposits is permitted.<\/li>\n\n\n\n<li>A maximum balance of\nonly 1 lakh rupees is allowed for the Payment Bank.<\/li>\n\n\n\n<li>The issue of credit\ncards is allowed. The payment Bank can only issue ATM\/debit cards.<\/li>\n\n\n\n<li>The payments and\nremittances services are allowed through various channels, including ATMs, BCs,\nBranches, and mobile banking.&nbsp; <\/li>\n\n\n\n<li>As per RBI guidelines,\nthe Payment Bank can act as Business Correspondent of another bank.<\/li>\n\n\n\n<li>The issue of PPI can be\ndone as per the instructions issued by the PSS Act from time to time.<\/li>\n\n\n\n<li>Payment Banks can offer\ninternet banking to its customers.<\/li>\n\n\n\n<li>The cross-border\nremittance transactions like personal payments\/remittances on the current\naccount will be permitted to be handled by Payment Bank.&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Foreign\nShareholdings<\/h3>\n\n\n\n<ul>\n<li>The foreign\nshareholdings in Payment Bank will be according to the Foreign Direct\ninvestment policy for private sector banks as amended from time to time.<\/li>\n\n\n\n<li><strong><em>The maximum of 74 % of\nthe paid-up capital of Payment Bank will be allowed as foreign investment in a\nprivate sector bank. Out of the 74%, 49% will be through the automatic route,\nand the remaining will be through the government route.<\/em><\/strong><\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Voting\nRights and Transfer of Shares<\/h3>\n\n\n\n<ul>\n<li>The Banking Regulation\nAct, 1949, will govern the voting rights of shareholders in Payment Bank. <strong><em>The\nvoting rights are capped at 10% and can be increased to 26% in a phased manner\nas prescribed by Reserve Bank of India (RBI). <\/em><\/strong><\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Business\nPlan.<\/h3>\n\n\n\n<ul>\n<li>The <strong><a href=\"https:\/\/corpbiz.io\/business-plan\" title=\"Business Plan\">business plan<\/a><\/strong> and project reports should be furnished by the applicants of the Payment Bank License.<\/li>\n\n\n\n<li>The main objective of\nsetting up of Payment Banks proposed by the Bank should be addressed in the\nbusiness plan.<\/li>\n\n\n\n<li>The business model,\naccess points of Payment Bank in rural and semi-urban areas, customer\ngrievances redressal, control over BCs should be covered in the business plan.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Prudential\nNorms<\/h3>\n\n\n\n<ul>\n<li><strong><em>The RBI regulations\napplicable to loans and advances will not apply to Payment Banks as they will\nnot have loans and advances in their portfolios<\/em><\/strong>.\n<\/li>\n\n\n\n<li>There will be a chance\nof exposure to operational risks of Payment Banks, so to curb the risks, an\noperational management risk system should be established by the Payment Banks.\nHence, liquidity risks can be faced by Payment Banks, so to avoid this, the\nPayment Banks are required to follow guidelines on liquidity risk management as\nprescribed by the Reserve Bank of India (RBI).<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Corporate\nGovernance<\/h3>\n\n\n\n<ul>\n<li>The Board of Payment\nBank <strong><em>should have a majority of Independent Directors.<\/em><\/strong><\/li>\n\n\n\n<li>The corporate\ngovernance guidelines, which include the \u2018fit and proper criteria\u2019 for\nDirectors, should be followed by the Payment Bank, which is issued by Reserve\nBank of India (RBI). <\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Other\nConditions<\/h3>\n\n\n\n<ul>\n<li>The operation of Payment Bank should be in remote areas through ATM&#8217;s, BCs, and other networks. At least 25% of the access points of Payment Banks should be in rural areas. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <\/li>\n\n\n\n<li>From the very beginning, all the operations of Payment Banks should be technology-driven and fully networked.<\/li>\n\n\n\n<li>Any new approach is encouraged; the plan for the same should be submitted to the RBI.<\/li>\n\n\n\n<li>The <strong><em>Banking Ombudsman Scheme, 2006, of RBI will regulate the Payment Banks.<\/em><\/strong><\/li>\n\n\n\n<li>For handling customer complaints, a high-powered customer grievance cell should be set up by Payment Bank.<\/li>\n\n\n\n<li>For the grant of License for Payment Bank, compliance with the terms and conditions laid down by Reserve Bank of India (RBI) should be there.<\/li>\n\n\n\n<li>Non-compliance with the terms and conditions laid down by RBI will attract penal provisions and also lead to the cancellation of the <a href=\"https:\/\/corpbiz.io\/payment-bank-license\" title=\"Payment Bank License\"><strong>Payment Bank License<\/strong><\/a>. &nbsp;<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_the_additional_information_to_be_furnished_by_Payment_Bank\"><\/span>What\nis the additional information to be furnished by Payment Bank?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>Payment\nBank should furnish the following additional information:<\/em><\/strong><\/p>\n\n\n\n<ul>\n<li><strong><em>The name, date of\nbirth, residential status, PAN card number, Bank, and branch details parents\nname of the promoter.<\/em><\/strong><\/li>\n\n\n\n<li>Detailed information <strong><em>of\nbackground, experience, expertise, a track record of business, financial worth,\ndirect and indirect interests in various companies, etc., of the promoter of\nthe Payment Bank.<\/em><\/strong><\/li>\n\n\n\n<li>The detailed\ninformation of the <strong><em>entity promoting the Payment Bank.<\/em><\/strong><\/li>\n\n\n\n<li>The detailed\ninformation of the <strong><em>entities and individuals promoting the Payment Bank.<\/em><\/strong><\/li>\n\n\n\n<li>The <strong><em>project\nreport covering the business plan, business viability, and potential of the\nproposed Payment Bank, and other financial services proposed to be offered.<\/em><\/strong><\/li>\n\n\n\n<li>The details of the <strong><em>entities\nand persons who will subscribe to the 5% or more of the paid-up equity capital\nof the Payment bank.<\/em><\/strong><\/li>\n\n\n\n<li><strong><em>The promoters of the\nPayment Bank can submit any other relevant information and relevant documents<\/em><\/strong>\nsupporting the applications of License. &nbsp;<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"_What_is_the_procedure_for_obtaining_the_Payment_Bank_License\"><\/span>&nbsp;What is the procedure for obtaining the\nPayment Bank License?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>The procedure for obtaining the Payment Bank License in India is as follows:<\/em><\/strong><\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" width=\"580\" height=\"402\" src=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/04\/image-24.png\" alt=\"procedure for obtaining Payment Bank License\" class=\"wp-image-6414\" srcset=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/04\/image-24.png 580w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/04\/image-24-300x208.png 300w\" sizes=\"(max-width: 580px) 100vw, 580px\" \/><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\">Incorporation\nof Company<\/h3>\n\n\n\n<ul>\n<li><strong><em>As per the guidelines\nof Reserve Bank of India (RBI), the applicant of License has to incorporate a\nPublic Limited Company under Companies Act, 2013.<\/em><\/strong>\nThe main object of the incorporated company should remain to act as a Payment\nBank. <\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Application\nto RBI<\/h3>\n\n\n\n<ul>\n<li>An application for a\ngrant of Payment Bank License will be filed <strong><em>to the Chief General Manager\nof Reserve Bank of India (RBI). <\/em><\/strong><\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Application\nEvaluation<\/h3>\n\n\n\n<ul>\n<li>The applicant can be\nsummoned for inquiries and validation of the information given by him in the\napplication. <strong><em>The External Advisory Committee (EAC) will asses the\napplication and summon the applicant.<\/em><\/strong><\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Granting\nof License<\/h3>\n\n\n\n<ul>\n<li>The RBI should grant\nthe Payment Bank License to the applicant who successfully meets the\neligibility criteria for License.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Online\nReview of License<\/h3>\n\n\n\n<ul>\n<li>The <strong><em>official site\nof RBI should display the name of<\/em><\/strong> <strong><em>the concerned applicants<\/em><\/strong>\nfor a bank license.&nbsp; <\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Approval\nof RBI<\/h3>\n\n\n\n<ul>\n<li>The principle approval\nto run a Payment bank should be given by RBI<strong><em>. After getting the principle\napproval from RBI to operate as Payment Bank, the Payment Bank should be set up\nin 18 months.<\/em><\/strong><\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_advantages_of_the_Payment_Bank\"><\/span>What\nare the advantages of the Payment Bank?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong><em>The\nadvantages of the Payment Bank are as follows:<\/em><\/strong><\/p>\n\n\n\n<ul>\n<li>No minimum balance is\nrequired to be maintained in the account.<\/li>\n\n\n\n<li>The interest rates given\nby the Payment Bank are higher as compared to other banks.<\/li>\n\n\n\n<li>The Payment Bank is\ndriven by high safe technology.<\/li>\n\n\n\n<li>The account number of\nPayment Bank is the same as the mobile number; hence, it is easier to memorize\nyour account number.&nbsp; <\/li>\n\n\n\n<li>The Payment Bank also\nprovides the facility of cashback in the mobile wallets of the customers.<\/li>\n\n\n\n<li>The merchants of\nPayment Bank provide certain offers like cashback, discounts, and many other\nbenefits to the customers.<\/li>\n\n\n\n<li>The customers can avail\nthe facilities of Payment Bank conveniently as these banks have a vast network area.\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Payments Banks is a game-changer that satisfies the needs of the modern era. The people nowadays rely mostly upon smartphones to make payments as it is more suitable and save their time to visit the banks. The Payment Bank is an internet-based financial institution that serves the &#8216;Digital India&#8217; dream of Government. The process of obtaining a Payment Bank License is long-lasting and time-taking. We at <a href=\"https:\/\/corpbiz.io\/\"><strong><em>Corpbiz<\/em><\/strong><\/a> have experienced professionals to help you with the process of getting a License for Payment Bank. Our professionals will assist you with the process and assure timely and successful completion of your work.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important\"><a href=\"https:\/\/corpbiz.io\/learning\/banking-regulation-amendment-bill-2020-introduced-in-lok-sabha\/\">FM Introduces Banking Regulation (Amendment) Bill, 2020<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>In the year 2013, the Reserve Bank of India (RBI) formed the concept of Payment Banks in India. Demonetization in India reorganized the economic system of India. Now the people are more inclined towards paperless transactions and use digital payment gateways. There was a sudden boost in the use of mobile wallets, which were earlier [&hellip;]<\/p>\n","protected":false},"author":16,"featured_media":6417,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[329],"tags":[470],"acf":{"service_id":"73"},"authorName":"Sakshi Sharda","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/02\/sakshi-sharda.jpg","authorDescription":"Sakshi Sharda has done BBALLB(HONS) and holds a strong knowledge on the matters pertaining to finance and law. From the past one year she is working as a legal advisor and in her leisure time she works on improvising her knowledge. Sakshi is spreading her knowledge by writing for Corpbiz.","postViews":4984,"readingTime":8,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/6412"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/16"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=6412"}],"version-history":[{"count":17,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/6412\/revisions"}],"predecessor-version":[{"id":68950,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/6412\/revisions\/68950"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/6417"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=6412"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=6412"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=6412"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}