Saturday, August 22, 2015

“Payments Banks”

Beyond our Salary and Perks,
We have to know what is going around us,
How they will affect our Banking Industry and ultimately
affect our Service conditions and finally a threat to our job itself.

One such development is entrance of “Payments Banks”
12 things to know about payments banks:
1) Customers can deposit only up to Rs 1,00,000
2) Payments bank can issue ATM/debit cards but not credit cards
3) Payments and remittance services through various channels can be done
4) Customers will be able to buy insurance and mutual funds
5) Bank would not carry out lending activities.

6) With this, the network of 1,54,000 post offices (including 1,30,000 rural post offices) will be offering banking services to the masses in the country.
7) Payments banks are targeting migrant labourers, low income households, small businesses, and other unorganised sector entities.
8) Initial capital required for a Payments bank is Rs 100 crore
9) Eligibility: Existing pre-paid payment instrument issuers, individuals, professionals, NBFCs, corporate business correspondents, telecom companies, super-market chains, real estate sector cooperatives that are owned and controlled by residents and public sector entities may apply.
10) Promoter’s contribution initially must be 40% for the first 5 years. For foreign holding, it is up to 74% of paid-up capital, on a par with private banks.
11) The banks must maintain CRR, minimum 75% of demand deposits in government bonds of up to one year and maximum 25% in current and fixed deposits with other scheduled commercial banks for operational purposes and liquidity management.
12) 41 applicants were in the race for payment bank licence, only 11 entities got the RBI nod for in-principle licence. Here is the list of these entities and with whom they are partnering for payments bank.
Aditya Birla Nuvo
Kumar Birla
Idea Cellular (49% stake)
Airtel M Commerce
Sunil Mittal
Kotak Mahindra (19.9%)
Cholamandalam Dist
Dept of Posts
Central Govt
Fino PayTech
24 banks and FIs
Banks and FIs
To go alone
Reliance Industries
SBI (30% stake)
Dilip Shanghvi
Sun Pharma
Yet to announce
Vijay S Sharma
To go alone
Tech Mahindra
Mahindra group
In talks with IFC
Vodafone m-pesa
Vodafone India

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