The Reserve Bank of India (RBI) recently issued operative guidelines for payment banks and small finance banks (differentiated banks).
These differentiated banks were set up to bring in new players who would leverage on technology for financial inclusion in a cost effective manner.
The apex bank granted in-principle approvals to 11 entities for setting up payments banks (PBs) in August 2015 and 10 for Small Finance Bank (SFB) in September 2015.
As per the latest guidelines, PBs can accept deposit only up to Rs 1 lakh.
Small Finance Banks will have to follow norms relating to minimum balance, inoperative accounts, nominations, and cheques/drafts.
The guidelines also state that PBs will have to maintain a minimum investment to the extent of not less than 75 per cent of ‘demand deposit balances’ as on three working days prior to that day, in Government securities/Treasury Bills with maturity up to one year that are recognised by RBI as eligible securities for maintenance of Statutory Liquidity Ratio (SLR).
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