Reserve Bank of India is all set to issue first set of Small and Payment bank licences in the next two months. The RBI had received a total of 72 applications for small finance bank licences and 41 applications for payment bank licences. The main objective behind the introduction of Small and Payment Bank is to promote Financial Inclusion. The banks will offer saving vehicles and credit to small business units and other unorganised sector entities.
The applicants include Department of Post, Ambanis, Tech Mahindra, Birlas, Videocon Group and stock exchange NSE..etc.
Small finance banks will primarily undertake basic banking activities of acceptance of deposits and lending to unserved and under-served sections including small business units, small and marginal farmers, micro and small industries and unorganized sector entities.
Payment banks would be allowed payment and remittance services through various channels. However, such lenders cannot issue credit cards or undertake lending activities.
GK Questions
- Who is the Chairman of the Committee on Comprehensive Financial Services for Small Businesses and Low-Income Households? Nachiket Mor
- Who is the Chairman of the committee which examined applications for new bank licenses? Bimal Jalan.
- The Reserve Bank of India granted two preliminary licences to set up new banks in India. What are they? IDFC Ltd and Bandhan Financial Services
