RBI issues draft guidelines for setting up small, payment banks

Zee Media Bureau

New Delhi: The Reserve Bank of India on Thursday issued draft guidelines for setting up small banks and payment banks.

The RBI also proposed Rs 100 crore as minimum capital required for setting up small bank and payment bank.

A committee appointed by the RBI had proposed the formation of payment banks to widen the spread of payment services and deposit products to small businesses and poor households in a country where about half of the households are outside the banking system.

In his Budget speech on July 10, Finance Minister Arun Jaitley had said: "RBI will create a framework for licensing small banks and other differentiated banks. Differentiated banks serving niche interests, local area banks, payment banks etc. Are contemplated to meet credit and remittance needs of small businesses, unorganized sector, low income households, farmers and migrant work force."

Earlier in April, the RBI had given in-principle approval to IDFC and Bandhan Financial Services to set up full-fledged banking operations.


With Agency Inputs