Payments Banks Struggling for Existence with Limited Scope In 2015, the Reserve Bank (RBI) gave in-principle approval for 11 entities to set up a different lender entity, termed ‘payments banks’. The objective was to establish new entities that could facilitate digital payments with minimal friction and bring more people into the banking system’s fold. Three years later, these seem to be struggling to carve and retain a niche for themselves. In fact, three — Cholamandalam Distribution Services, Sun Pharmaceutical and Tech Mahindra — surrendered their licences without starting operations. Of the rest, Reliance’s Jio payments bank was launched last month. India Post has had a soft launch and is yet to start full operations. Currently, only three have completed more than six months of operation in the space — Fino Payments Bank, Airtel Payments Bank and Paytm. Fino started with the broadest base, of 410 branches across 14 states, 25,000 banking poi...
