The establishment of ‘Payment Banks’ is being allowed in India to promote financial inclusion. Which of the following statements is/are correct in this context?
- Mobile telephone companies and supermarket chains that are owned and controlled by residents are eligible to be promoters of Payment Banks.
- Payment Banks can issue both credit cards and debit cards.
- Payment Banks cannot undertake lending activities.
Select the correct answer using the code given below.
1 and 2 only
1 and 3 only
2 only
1, 2 and 3
Answer is Right!
Answer is Wrong!
This question was previously asked in
UPSC IAS – 2016
1. **Mobile telephone companies and supermarket chains that are owned and controlled by residents are eligible to be promoters of Payment Banks:** The RBI guidelines for licensing of Payment Banks specify that various entities including non-bank Pre-paid Payment Instrument (PPI) issuers, NBFCs, corporate business correspondents, mobile telephone companies, supermarket chains, and public sector entities can be promoters. Entities must be owned and controlled by residents. This statement is correct.
2. **Payment Banks can issue both credit cards and debit cards:** Payment Banks can issue ATM/Debit Cards. However, they are explicitly NOT allowed to issue Credit Cards. This statement is incorrect.
3. **Payment Banks cannot undertake lending activities:** One of the key restrictions on Payment Banks is that they cannot undertake lending activities, either directly or indirectly. Their role is focused on deposit acceptance (up to a certain limit) and payments/remittances. This statement is correct.