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Future of Depository With Introduction of Payment Bank: A Game Changer To Capital Market

The document discusses the introduction of payment banks in India and how this will impact capital markets. Payment banks will help increase financial inclusion and provide basic banking services to low-income and small business customers. NSDL, one of India's depositories, received approval to operate as a payment bank, which will allow investors to open trading, demat, and savings/current accounts with depository participants through a single window.

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56 views1 page

Future of Depository With Introduction of Payment Bank: A Game Changer To Capital Market

The document discusses the introduction of payment banks in India and how this will impact capital markets. Payment banks will help increase financial inclusion and provide basic banking services to low-income and small business customers. NSDL, one of India's depositories, received approval to operate as a payment bank, which will allow investors to open trading, demat, and savings/current accounts with depository participants through a single window.

Uploaded by

NationalinstituteDsnr
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Future of Depository with Introduction of Payment Bank:

A Game Changer to Capital Market

Abstract: Visionary aspiration of constructing payment banks in addition to financial inclusion by spreading the payment
assistance to unbanked section of the population with greater access to small business, low-income house hold, labor
workforce, encouraging small investors, remittance services includes investor protection, sustaining fair, transparent and
productive markets, systemic risk minimization, flourish new products, boosting the securities market platform, boosting
up operational effectiveness and alluring new players, numerous regulatory variation in the Indian securities market were
made by the regulators in India—the Ministry of Finance, the Securities and Exchange Board of India (SEBI), and the
Reserve Bank of India (RBI). Recently the Indian government proposed a set of new players in Indian Banking Industry.
In the history of banking sector RBI release distinctive licenses for distinctive activities like Payment Bank. It is a step to
broaden banking in India. The concept of payment bank was first floated by RBI committee led by Nachiket Mor. To
enlarging the scope of banking services and financial inclusion and focus on basic banking facilities, especially to low-
income class and small-scale businesses as well as other unorganized sector entities the RBI has given in-principal
approval to 11 entities out of 41 companies. It primarily provides remittance, payment services, transfer money directly to
bank etc. NSDL is also the one and single depository among all the Depositories and Exchanges which gets the approval
for the payment bank. NSDL as a payment bank opens new avenues for both the depository participant and investors. The
bank aims to widest range of devices used by its target customer segments, whether desktop, laptop or mobile devices, to
being able to tab into the largest number of customers available in the segment. A dream of Three in One account i.e.
Trading, Demat and saving/current bank accounts which can be opened with the Depository Participant will comes true.
Investor freely enjoys the settlement benefits with the same banking channel, interest incurred, shopping and merchant
payments, investments in the Ipos platform, sell 3rd party products such as mutual funds in single window, loans and
insurance, P2P payments. Also bill payments and charges as the income model will only be transaction income. This
reform in capital market will set an important milestone for both depository and capital market.
Keyword: Payment bank, Depository, NSDL, Capital Market, Financial Inclusion.

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