InvestorQ : Why did payment banks start operating in India given that we already have enough banks?
Anjali Desai made post

Why did payment banks start operating in India given that we already have enough banks?

Answer
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Suresh Patil answered.
1 year ago


Yes, it is true that we have enough banks across the country. However, this hasn’t resulted in a meaningful financial inclusion. What this means is that there are still areas in the hinterlands of India where people don’t have any bank accounts and deal with cash directly.

Not only are these individuals not benefiting from the various services banks can offer them, but they also then stick to traditional and often exploitative means of borrowing money.

The Reserve Bank stated: “The objectives of setting up of payments banks will be to further financial inclusion by providing (i) small savings accounts and (ii) payments/remittance services to migrant labour workforce, low income households, small businesses, other unorganised sector entities and other users.”