Aditya Birla Group has announced to close its payment bank. Even before the licensed companies have not shown interest in the business, the questions are beginning to rise, is the future of the payment bank? According to Naveen Surya, Chairman of Payments Council of India, those companies who did not have experience of payment business have returned the licenses and due to changes in the rules made in the last one year, the interest in the payment business of companies has also reduced.
Got License in 2015
According to the report, the financial condition of payment banks is worrisome. RBI issued licenses of payment bank in August 2015. Many banks have not been able to start operations yet. In general, the condition of any payment bank is not well. It is believed that some other payment banks may be closed in the coming days. Aditya Birla Group’s payment bank business had not been in the 17 months even as news about closure has come.
What are the Problems of Payment banks?
Let us say that in 2015, 11 major corporate houses of the country had received payment bank licenses. Companies that did not have experience of payment business decided to withdraw the license. Most companies were involved in telecom business. In the telecom sector, the interest of companies has also declined in this business. Especially, due to changes in the rules in the past year, there has been additional pressure on the companies. It is difficult for all banks to start KYC renewal of all customers. Apart from this, there are many types of challenges.