Reserve Bank of India takes a step to allow the authorized non-bank payment system providers to participate in centralized payment systems, the Payments Council of India. They are the country’s largest industry body for the non-banking digital payment ecosystem.
In the first phase, the authorized non-banks PSPs, PPI issuers, card networks, and white label ATM operators will be eligible to participate in CPS.
Based on the monetary policy in April 2021, the central bank declared that it will encourage the non-banks in the RBI-operated systems. Also, there will be direct access to non-banks to CPS that will lower the overall risk in the payment ecosystem.
It will even be a great advantage to non-banks like reduction within the cost of payments, minimizing dependency, time is taken for the completing of payments, and elimination of uncertainty in the finality of the payments.
Also, the delay of fund transfers is often avoided when the transactions are directly initiated and processed by non-bank entities.
Vishwas Patel, Chairman, Payments Council of India and Director, said, the central banks are efforting to promote the use of digital payments and making access to RTGS and NEFT to the Prepaid Payment issuers, Card Networks, and other systems.
This move will bring a bright way forward for digital payments instruments.
Mahendra Nerurkar, VP and CEO, Amazon Pay, PPI Committee, said, Thanking the central bank for allowing the prepaid payment instrument Issuers access to the centralized payment system. This will lead to strengthen digital payments and bring more innovation as well as improving customer protection.
To create a financially inclusive society in the country, Digital Payments are the right step to move forward. PCI can make such varied discussions with RBI with a vision to promote a cashless payment.
The NEFT and RTGS systems are made available for 365 days and 24*7 with effect from December 2019 and December 2020.
For access to CPS, non-bank PSPs would require, a validation certificate of authentication by RBI under the payment and settlement system act, 2007, net worth at least Rs 25 crore, adequate technical readiness, and compliance with including the local payment data storage.
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