Mobile commerce and payments company Paytm on Tuesday said the Reserve Bank of India has given it the final permission to open a payments bank.

In a blog titled ‘Everything Changes Again: From Payments to Payments Bank’, founder Vijay Shekhar Sharma: “Today, Reserve Bank of India gave permission to formally launch Paytm Payments Bank. We can’t wait to bring it in front of you...No other role or responsibility means as much to me as the privilege of building Paytm Payments Bank, and I intend to take a full-time executive role in the bank.”

However, he did not mention an exact date for the launch. Paytm, launched three years ago as a mobile wallet, is now aiming to build a new business model in the banking industry, focussed on bringing financial services to the un-served or underserved Indians, Sharma said.

Paytm and 11 other players, including Vodafone, Airtel and Fino PayTech, had applied for a payments bank licence in 2015.

While Airtel has already gone live with its payments bank in a few States, Fino plans to launch it the first half of this year.

Last year, the RBI had issued a separate operating guidelines for payments banks and small finance banks in view of their differentiated nature of business and focus on financial inclusion

The RBI has granted in-principle approvals to 11 payments banks (August 2015).

The central bank had said that it will have no objection to payments banks making arrangements with other scheduled commercial/small finance banks, whereby amounts in excess of the prescribed limit of ₹1 lakh can be swept into an account opened for the customer with the latter.

This arrangement should be activated with the prior written consent of the customer.

Related Topics
comment COMMENT NOW