ISAS Briefs

The Reserve Bank of India issued in-principle licences to 11 different entities to establish payments banks in India in August 2015. This initiative is a historical step – there is no such banking structure in operation in any other part of the world. Fully based on modern technology, these payments banks are expected to bring the huge unbanked population of India under the formal banking system. This paper analyses how the payments banks were established, and the opportunities they offer and challenges faced by them.