- Characteristics & Features of small Banks
- Characteristics of payment bank
- Key Features of Payment Bank
Characteristics & Features of small Banks
Another set of Banks that are planning to be available in our Banking Sector in Indian country is Small Banks. Small Banks will take Deposits and might conjointly lend cash, similar to a scheduled banking concern in India. As per pointers ordered down by depository financial institution of Asian country for small banks, 0.5 the Loans which can tend by small Banks ought to be but twenty-five Lakhs. Also, they’ll not be ready to lend quite 100% to one receiver and V-J Day to the cluster of Borrowers. Small Banks could give stiff competition to massive Banks in India. Several of the Mid-sized Banks that don’t seem to be equipped in terms of technology and poor quality of Human Resource practices along with employees could face stiff competition and should become a nightmare for these Banks. Alternative Conditions & Clarifications
- The operations of the Bank ought to be networked NAD technology-driven from the start, conformist to usually accepted standards and norms.
- The Business setup ought to be viable and it’s to be realistic and viable. The entity needs to give a Business setup covering the next 5 years. It ought to address however the Bank proposes to realize money Inclusion.
- Bank ought to detain place provision for top battery-powered client Grievance cell to handle client complaints.
- The Legal provisions of the SARFAESI Act & DRT mechanism are offered to small Banks conjointly.
- The necessity of possession and management by Residents applies to all or any entities promoting or changing into small Bank that conjointly includes NBFCs and MFIs.
Characteristics of payment bank
- Up to Rs one 100000 deposit
- Payments Bank worship to 1 lakh limits on deposits. You cannot exceed the limit for any purpose of your time. The number is often deposited in components or fully. So far, there has been no word from the run relating to the extension of this limit. The limit has been set keeping the comparatively new nature of the banks and guarding client interests.
- No monthly account maintenance
- In the case of most payments banks within the country, there’s no minimum account balance needed. Customers will select zero balance accounts. However, just in the case of Airtel Payments Bank, there’s a minimum first-time deposit of Rs.100 needed.
Key Features of Payment Bank
Savings Account and accounting
Payments Bank will operate each bank account and current accounts. Whereas bank account can draw interest every quarter, Current Accounts won’t gain any interest. Current accounts are specifically just for merchants. There’s only commonplace saving account for all customers, in contrast to ancient banks wherever Savings accounts are divided into multiple tiers, betting on client preference or account balance. Also, there are not any earnings accounts in the payments bank.
Standard interest on savings
Money in payments bank accounts is eligible to earn interest. The interest rates could vary from bank to bank, however, the minimum as such as by RBI is 4% interest. Airtel Payments Bank, however, offers a higher rate at nearly 7.5 percent, followed by India Post Payments Bank at 5.5 % whereas Paytm Payments Bank offers the quality 4%.
Physical and virtual charge account credit
Payments bank supply each, physical further as virtual debit cards. The most effective part of the debit cards is that they are usable in any respect ATMs within the country further as abroad. Whereas virtual debit cards haven’t any charges, physical debit cards are among the annual fees. To boot, ATM withdrawals over a precise limit also are guilty. RBI new pointers for pocketbook services: Strict laws, client security, access to ability, and more
Online funds transfer services
Customers will avail themselves of online fund transfer services like NEFT, IMPS, and a lot of victimization payments banks. As these banks are digital, online transfer of cash is that the most well-liked model. Whereas there are charges related to online transfers, Paytm Payments Bank offers free online transactions.
Payments Bank is fully digital eliminating the necessity to go to a physical bank for transactions. Although they are available with options sort of a charge account credit and cheque book, the transactions will simply be administrated online while not the necessity to own a physical outlet. It promotes the Indian government’s dream of Digital India. Being on the smartphone, they’re invariably accessible and transactions are often done on the go.
No loan or term deposits
Payments Bank is presently not allowed to produce any loans to customers. In contrast to ancient banks that for the most part consider financial gain from loans, payment banks invest the number within the stock exchange or in government bonds for financial gain. A part of the returns are then transferred to customers are interest on savings. To boot, there are not any term deposit choices in the payments bank.
Most Payments Bank within the country has several offers to create them appear a lot enticing. Whereas Airtel Payments Bank offers higher interest rates, mobile range as account range, free speak time, and insurance Paytm Payments Bank offers cashback to customers on a deposit of Rs 25,000 and fully free banking services.