The Reserve Bank of India is expected to come out with final guidelines for operating small and payments banks by November end. The regulator said based on the feedback received, final guidelines on licensing of these banks will be issued by end-November 2014. It had issued draft guidelines in this regard in July. It is expected that the guidelines will set the norms for micro finance institutions, telecom companies, NBFCs and other entities to enter the banking space. The proposed small banks will provide basic banking products such as deposits and supply of credit, but in a limited area of operation. Payments banks will offer a limited range of products such as acceptance of demand deposits and remittances of funds. It is expected that these banks can be set up with a minimum capital of Rs 100 crore as against Rs 500 crore required for normal commercial banks.
