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RBI unveils framework for retail payments entity
Why is it in news?
- The Reserve Bank of India (RBI) released a framework for setting up of a pan-India umbrella entity for retail payments systems.
- The formation of the umbrella entity has been authorised under the Payment and Settlement Systems Act, 2007.
Details:
- The new entity would be incorporated under the Companies Act, 2013.
- The umbrella entity will set up, manage and operate new payments systems in the retail space.
- It would comprise ATMs, white label PoS, Aadhaar-based payments and remittance services.
Other Tasks of the proposed entity:
- Operate clearing and settlement systems for participating banks and non-banks.
- Identify and manage relevant risks.
- Monitor retail payments system developments and related issues in the country and internationally.
Significance:
- The entity would frame necessary rules and the related processes to ensure that the system is safe and sound, and that payments are exchanged efficiently.