In a bid to increase the participation of Fintech and Insurance firms in the economy, the Reserve Bank of India (RBI) is considering to allow RTGS and NEFT transaction for non-banking corporations. The apex bank urges that these provisions are considered to uphold the banking services in line with global best practices.
Following the trends of the banking regulatory authorities of England and Switzerland, the RBI argued, in its Financial Stability Report (FSR), that there is an utmost need for easing the access to Centralised Payments Systems (CPS) to non-banking corporations in India. The move will reduce the cost and will also ease out the access to funds in the market.
In the FSR, the apex financial regulatory authority of India said, “The Reserve Bank will examine the case for increased participation of non-banks in CPS,” adding, “Internationally, central banks are expanding access to payment systems by enabling various types of non-banks to become members.”
As of now, there is limited access to CPS to beneficiaries like central counterparties, NABARD, EXIM Banks and DICGC. However, the new regulations, when it comes into action, will drastically increase the number of beneficiaries. On top of that, the RBI is also planning to introduce New Umbrella Entities (NUE) for retail payment systems.