{"id":2535,"date":"2021-02-20T11:36:58","date_gmt":"2021-02-20T11:36:58","guid":{"rendered":"https:\/\/swaritadvisors.com\/blog\/?p=2535"},"modified":"2021-02-24T09:44:45","modified_gmt":"2021-02-24T09:44:45","slug":"apply-for-payment-bank-license","status":"publish","type":"post","link":"https:\/\/swaritadvisors.com\/blog\/apply-for-payment-bank-license\/","title":{"rendered":"How to Apply for Payment Bank License?"},"content":{"rendered":"\n<p class=\"has-drop-cap\">After demonetization, a new wave of digital transactions in India has come, and people start becoming more dependent on online transactions and tend to use online payment portals, and it has given a quick boost to e-wallets and mobile wallets. So, to start a payment bank, one needs to apply for a <strong><a class=\"text-primary\" href=\"https:\/\/swaritadvisors.com\/payment-bank-license\">Payment Bank License<\/a><\/strong>. According to the Banking Regulation Act, 1949, the RBI or Reserve Bank of India issues the Payment Bank License. These banks&#8217; transactions are similar to normal banks, but they did not provide any loan and issue any credit cards. These Payment Banks simplifies banking life because it brings more accessibility and flexibility and offers various offers to the customers through secured digital platforms. Scroll down to check more information regarding Payment Banks and the process to apply for Payment Bank License.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3af2eecbd2e\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3af2eecbd2e\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/swaritadvisors.com\/blog\/apply-for-payment-bank-license\/#Payment_Bank_%E2%80%93_An_Overview\" title=\"Payment Bank \u2013 An Overview\">Payment Bank \u2013 An Overview<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/swaritadvisors.com\/blog\/apply-for-payment-bank-license\/#Regulatory_Authorities_Which_Governs_Payments_Bank\" title=\"Regulatory Authorities Which Governs Payments Bank\">Regulatory Authorities Which Governs Payments Bank<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/swaritadvisors.com\/blog\/apply-for-payment-bank-license\/#Who_can_apply_for_Payment_Bank_License_in_India\" title=\"Who can apply for Payment Bank License in India?\">Who can apply for Payment Bank License in India?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/swaritadvisors.com\/blog\/apply-for-payment-bank-license\/#Crucial_details_provided_to_RBI_for_obtaining_Payment_Banks_License\" title=\"Crucial details provided to RBI for obtaining Payment\nBanks License\">Crucial details provided to RBI for obtaining Payment\nBanks License<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/swaritadvisors.com\/blog\/apply-for-payment-bank-license\/#Information_of_the_Individual_Promoter\" title=\"Information of the Individual Promoter\">Information of the Individual Promoter<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/swaritadvisors.com\/blog\/apply-for-payment-bank-license\/#Information_of_the_Entity\" title=\"Information of the Entity\">Information of the Entity<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/swaritadvisors.com\/blog\/apply-for-payment-bank-license\/#Information_of_the_Entities_and_Individuals_in_the_Group_of_Promoter\" title=\"Information of the Entities and Individuals in the Group\nof Promoter\">Information of the Entities and Individuals in the Group\nof Promoter<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/swaritadvisors.com\/blog\/apply-for-payment-bank-license\/#Process_to_Apply_for_Payment_Bank_License_in_India\" title=\"Process to Apply for Payment Bank License in India\">Process to Apply for Payment Bank License in India<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/swaritadvisors.com\/blog\/apply-for-payment-bank-license\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Payment_Bank_%E2%80%93_An_Overview\"><\/span>Payment Bank \u2013 An Overview<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In 2013, <a href=\"https:\/\/www.rbi.org.in\/\">RBI<\/a> (Reserve Bank of India) introduced a new concept of a specialized bank model known as Payment Bank. Just like regular banks, the transaction or financial services are the same except for providing loans and credit cards. The primary purpose of introducing payment banks was to expand the reach of payment facilities to lower-income groups and assist small businesses. In the case of payment banks, there is a restricted deposit amount of up to a maximum limit of Rs. 1 lakh per customer which may increase further. According to the Banking Regulation act, payment banks have the permit to form new outlets such as ATMs, Business Correspondents, but cannot begin the banks&#8217; activities and the minimum paid-up capital of payment banks should be Rs. 100 crores or more. The first payment bank was established in India is&nbsp;<em><strong>Bharti Airtel.&nbsp;<\/strong><\/em>So to establish a payment bank, one needs to apply for Payment Bank License in India.<\/p>\n\n\n\n<p><strong>Also, Read:<\/strong> <mark style=\"background: #fffd03 !important\"><a href=\"https:\/\/swaritadvisors.com\/blog\/requirements-for-payment-bank-license\/\">What are the Requirements for Payment Bank License?<\/a><\/mark><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Regulatory_Authorities_Which_Governs_Payments_Bank\"><\/span>Regulatory Authorities Which Governs Payments Bank<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<ul><li>RBI Act, 1934.<\/li><li>Companies Act, 2013.<\/li><li>FEMA, 1999 (Foreign Exchange\nManagement Act).<\/li><li>Banking Regulation Act, 1949.<\/li><li>DICGC Act, 1961.<\/li><li>Payment and Settlement Systems\nAct, 2007.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Who_can_apply_for_Payment_Bank_License_in_India\"><\/span>Who can apply for Payment Bank License in India?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>RBI\nhas laid down a list of eligible promoters for Payment Bank License as it\nrequires at least Rs. 100 crores paid-up capital. You can check the list of\nqualified promoters below who are eligible to apply for Payment Bank License:<\/p>\n\n\n\n<ul><li><strong><a href=\"https:\/\/swaritadvisors.com\/nbfc-registration\" class=\"text-primary\">NBFCs<\/a><\/strong>\nor Non-Banking Financial Companies.<\/li><li>BCs or Business Correspondents.<\/li><li>Individuals or Professionals.<\/li><li>Public Sector Companies.<\/li><li>Supermarket Chains.<\/li><li>Telecom Companies or telephone\ncompanies.<\/li><li>Real Sector Cooperatives.<\/li><li>Existing non-banking PPI or Prepaid\nPayment Instrument under the Payment and Settlement Systems Act, 2007.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Crucial_details_provided_to_RBI_for_obtaining_Payment_Banks_License\"><\/span>Crucial details provided to RBI for obtaining Payment\nBanks License<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Following\nare some essential details that should be provided to RBI for attaining Payment\nBanks License:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Information_of_the_Individual_Promoter\"><\/span>Information of the Individual Promoter<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<ul><li>Promoter\u2019s Name.<\/li><li>DOB or Date of Birth.<\/li><li>Residential Status.<\/li><li>Parent\u2019s Name.<\/li><li>PAN Number.<\/li><li>Expertise Areas.<\/li><li>Experience of the individual promoter.<\/li><li>Details of a branch and bank account including the credit facilities.<\/li><li>Track record of Financial Worth and Business.<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Information_of_the_Entity\"><\/span>Information of the Entity<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<ul><li>Shareholder pattern of the\nentity.<\/li><li>MOA or Memorandum of\nAssociation and AOA or Articles of Association of the company or entity.<\/li><li>Last five year financial\nstatements of the promoter entity.<\/li><li>Previous three years of <strong><a href=\"https:\/\/swaritadvisors.com\/income-tax-return-filing\" class=\"text-primary\">Income Tax Returns<\/a><\/strong>\n(ITR).<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Information_of_the_Entities_and_Individuals_in_the_Group_of_Promoter\"><\/span>Information of the Entities and Individuals in the Group\nof Promoter<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<ul><li>Names of entities and individuals.<\/li><li>Management details.<\/li><li>PAN Number.<\/li><li>TAN Number.<\/li><li>CIN Number.<\/li><li>Details of Bank Account and\nBranch.<\/li><li>Total assets of entities. <\/li><li>Pictorial Organogram.<\/li><li>Shareholding Details.<\/li><li>Details of Stock Exchanges.<\/li><li>Last five years Annual Report\nof all the group entities.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Process_to_Apply_for_Payment_Bank_License_in_India\"><\/span>Process to Apply for Payment Bank License in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Below\nis the process to apply for Payment Bank License in India:<\/p>\n\n\n\n<ul><li>The Payment Bank License must\nbe issued under the Banking Regulation Act, 1949, and it should be incorporated\nas a <strong><a href=\"https:\/\/swaritadvisors.com\/public-limited-company-registration\" class=\"text-primary\">Public\nLimited Company<\/a><\/strong> under the Companies Act, 2013.<\/li><li>Any registered company in India\nand desiring the commence banking business as per rule 11 of the Act shall make\nan application using Form III for a payment bank license.<\/li><li>The application for the license\nshall be addressed to the CGM or Chief General Manager of the Department of\nBanking Regulation, RBI.<\/li><li>The initial screening will be\nconducted to check the prima facie admissibility, and extra criteria may also\nbe applied, if need.<\/li><li>An External Advisory Committee\ncontaining well-known professional such as Bankers, Chartered Accountants,\nFinance Professionals, etc., shall consider the application.<\/li><li>The EAC or External Advisory\nCommittee may call for information and have negotiations &amp; discussions with\napplicants deemed fit by it.<\/li><li>The RBI will make the result\nissue an approval (in-principal), and it will be final and concluded. The\nin-principal approval shall stay tie for eighteen months, and it means that the\nbank has to be set up within a period itself.<\/li><li>If any opposing features are\nfound post-issuance of the approval, the Reserve Bank of India may execute\nextra conditions if required. Moreover, it may take out the in-principal\napproval.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Payment bank has made banking easier because of the flexibility and convenience they provide. They provide many services to consumers through secure digital platforms. Therefore consider opening a payment bank but don&#8217;t forget to apply for payment bank license. It is mandatory to obtain this license.<\/p>\n\n\n\n<p><strong>Also, Read:<\/strong> <mark style=\"background: #fffd03 !important\"><a href=\"https:\/\/swaritadvisors.com\/learning\/meaning-and-process-of-online-payment-gateway-in-india-2020\/\">Meaning and Process of Online Payment Gateway in India 2020<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>After demonetization, a new wave of digital transactions in India has come, and people start becoming more dependent on online transactions and tend to use online payment portals, and it has given a quick boost to e-wallets and mobile wallets. So, to start a payment bank, one needs to apply for a Payment Bank License. [&hellip;]<\/p>\n","protected":false},"author":6,"featured_media":2536,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[391,56],"tags":[410],"acf":[],"_links":{"self":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/2535"}],"collection":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/comments?post=2535"}],"version-history":[{"count":7,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/2535\/revisions"}],"predecessor-version":[{"id":2631,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/2535\/revisions\/2631"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media\/2536"}],"wp:attachment":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media?parent=2535"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/categories?post=2535"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/tags?post=2535"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}