TO FUNC­TION UN­DER RBI Pay­ments In­dus­try will Soon Have a Reg­u­la­tory Board It will help re­solve dis­putes, en­sure customer pro­tec­tion, check foul play by dom­i­nant play­ers

The Economic Times - - Front Page - Pratik.Bhakta@ times­ FOR SMOOTH PAY­MENTS

Mum­bai: The gov­ern­ment, keen on pro­mot­ing dig­i­tal pay­ments, will form a sep­a­rate reg­u­la­tor for the pay­ments in­dus­try to re­solve dis­putes, en­sure customer pro­tec­tion and check­any­foulplay­by­dom­i­nant­play­ers. Fi­nance min­is­ter Arun Jait­ley has called for an over­haul of the Pay­ment and Set­tle­ments Act 2007 to cre­ate the Pay­ments Reg­u­la­tory Board. He said the board would be un­der the Re­serve Bank of In­dia (RBI). This is be­ing done to avoid crit­i­cism that the board would di­lute the bank­ing reg­u­la­tor’s pow­ers.

“It is pro­posed to cre­ate a Pay­ments Reg­u­la­tory Board in the Re­serve Bank of In­dia by re­plac­ing the ex­ist­ing Board for Reg­u­la­tion and Su­per­vi­sion of Pay­ment and Set­tle­ment Sys­tems,” said Jait­ley in his Bud­get speech. “The Pay­ments Reg­u­la­tory Board will ex­er­cise the func­tions re­lat­ing to the reg­u­la­tion and su­per­vi­sion of pay­ments and set­tle­ment sys­tems un­der the Act.” The pay­ments in­dus­try has been cry­ing for at­ten­tion in the wake of the­ex­plo­sionof fi­nan­cial­tech­nol­ogy com­pa­nies that fa­cil­i­tate trans­ac­tions. Con­sumers have em­braced their ser­vices due to the sim­plic­ity they of­fer. But there have been al­le­ga­tions that dom­i­nant banks have been cre­at­ing hur­dles for such com­pa­nies to pro­tect their turf.

The board would look at in­ter­op­er­abil­ity of dig­i­tal trans­ac­tions and fa­cil­i­tate competition and in­no­va­tion among fi­nan­cial tech­nol- ogy com­pa­nies in the pay­ments space. It will also be re­spon­si­ble for con­sumer pro­tec­tion, de­cide on penal­ties and cre­ate ap­peal mech­a­nisms, which could en­sure faster res­o­lu­tion of dis­putes over set­tle­ment of dig­i­tal pay­ments.

The pro­posed board will have the RBI gov­er­nor as the chair­per­son, along with a deputy gov­er­nor in charge of pay­ments as mem­ber, be­sides an RBI officer nom­i­nated by the RBI Board. It will also have three mem­bers nom­i­nated by the cen­tral gov­ern­ment.

Reg­u­la­tory Board will re­place Board for Reg­u­la­tion and Su­per­vi­sion of Pay­ment and Set­tle­ment Sys­tems

to be set up on the rec­om­men­da­tions of Ratan Watal com­mit­tee and CMs’ panel for dig­i­tal pay­ments

It will Two RBI It will Board

have the RBI gov­er­nor as chair­man

of­fi­cials, in­clud­ing deputy gov­er­nor in charge of pay­ments, and three gov­ern­ment nom­i­nees will be mem­bers

look at pay­ments, in­no­va­tion, cy­ber se­cu­rity, customer griev­ance and re­dres­sal

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