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Presented BY – BATCH-23

Name- 1.Baisakhi Chowdhury2.Supravat Pramanik

3.Gems Simoon Kisku

Topic Outline Introduction

-What is a Payment Bank?-Structure-Features

Birth Of Concept

- The Nochiketa Mor committee-Financial Inclusion

Benefits Challeges Growth Impact On The Society Conclusion

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On 19th August 2015, The Reserve Bank of India gave “In-Principle” License to eleven entities to launch payment bank. These are :

1. National Securities Depository Limited2. Reliance Industries3. Aditya Birla Nuvo4. Airtel M commerce5. Department of Post6. Fino Paytech7. Tech Mahindra8. Vodafone M - Pesa9. Cholamandalam distribution Services10. Paytm11. Sunpharma

In Recent News

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 traditional bank branches.

O They are allowed to undertake only certain restricted banking functions that the Banking Regulation Act of 1949 allows.

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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 depositLiability should not exceed 20 times of its net worth

Have 25% of branches in unbanked areas

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Features Of Payments Bank

Who Can Promote?

How do they earn?

Prepaid card issuers, Telecom Companies, NBFC’s, Business correspondents, Supermarket Chains, Corporates, Realty sector co-ops & PSUs

RBI allows these bank to invest 75% in govt. Secuirity 25% in other Bank

Charged 1 or 2% on normal cash transfer

No risk for losses on NPAs

Play on Volume by attach million of customer

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Features Of Payments Bank

O 1 Lakh deposit in one acc

O Offer Internet Banking

O Sell Mutual Fund, Insurencre, Pension

O Offer Bill Payment services for customer

O Have business Correspondents

O Offer credit card

O Extend LoanO Handle cross

Border Remittance

O Accept NRI deposit

Do’s Dont’s

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Birth of the Concept

The payment bank cames into existance as a result of Nochiketa more ComitteOfficially 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-2013This committee had submiytted its Report in January 2014 and had recommended, among other things, Setti9ng up of the small bank and payment bank

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Benefits They offerService Charge will come down

No cap to maintain minimum BalanceRBI rate cut Benefit

Payment Banks may make handling cash a lot easier

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GrowthSBI will take off in 30% of RIL

Proposed BankBharti 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

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Impact On the Society

Need to introduce new product and new Application

Increase their customer

Mobile phone transaction still has opportunity to penetrate rural India with alternate methods for transaction

“Payments Bank will

change the way people

think, Change the way they

keep the money, where

they keep their money, the way they

pay”

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Conclusion 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 for the economy as whole.

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