Mumbai: The Reserve Bank of India (RBI) on Monday proposed to relax norms for entry of new players in the retail payment systems with a view to give a boost to innovation and competition.
The RBI has been issuing guidelines for various payment systems and grants authorisation to non-banks for setting up and operating payment systems.
Licensed banks also need to obtain specific permission from Reserve Bank for setting up and operating a payment system. At the end of 2018, there were 89 authorised non-bank payment system operators (PSOs).
The RBI's policy paper on 'Authorisation of New Retail Payment Systems' proposes a multi-pronged policy action for a more appropriate level of retail payment systems and operators.
With regard to entry point norms for entities, the paper said a judicious approach needs to be adopted with regard to networth criteria.
"For all payment systems it would be desirable that they have (a) physical presence in the country, (b) impeccable track record, and (c) are likely to conform to the best overall standards, including those pertaining to customer service and efficiency," the paper said.
It also makes a case for alignment of regulatory framework to encourage enhanced participation of both bank and non-bank entities.
Earlier in June last year, the RBI had announced that it would encourage more players to participate in and promote pan-India payment platforms and would bring out a policy paper.
The objective, it said was to minimise the concentration risk in the retail payments market from a financial stability perspective and to give a fillip to innovation and competition.
The central bank has invited comments on the policy paper by 20 February.
To keep watching India’s No. 1 English Business News Channel – CNBC-TV18, call your Cable or DTH Operator and ask for the Colors Family Pack (inclusive of 24 channels), available for Rs. 35/- per month, or subscribe to the channel for Rs. 4/- per day.
To keep watching the Leader in Global Market & Business News – CNBC-TV18 Prime HD, call your Cable or DTH Operator and ask for the Colors Family HD Pack (inclusive of 25 channels), available for Rs. 50/- per month, or subscribe to the channel for Rs. 1/- per day.
Firstpost is now on WhatsApp. For the latest analysis, commentary and news updates, sign up for our WhatsApp services. Just go to Firstpost.com/Whatsapp and hit the Subscribe button.
Updated Date: Jan 22, 2019 10:54:12 IST