RBI formulated new regulations framework for Umbrella entity for retail payments

The Reserve Bank of India formulated a new framework for the establishment of a new umbrella entity for retail payments. According to RBI, the entity will be handed over the responsibility of setting up, managing, and operating new payment systems in the retail space following the same way as the National Payments Corporation of India (NPCI) does.

The guideline of RBI says such an entity must have a minimum paid-up capital of Rs 500 crore.

The entity will be registered under  ‘for-profit’ or a Section 8 Company as per the Companies Act, 2013.

What is the Companies Act 2013?

It is an Act of the Parliament of India to regulate the incorporation, responsibilities, directors, dissolution of a company. It has 29 chapters that contain 470 sections. Section 8 Company is registered for charitable or non-profit purposes.

What is retail payment?

Retail payments are the transactions between consumers and businesses and public authorities like store payments, online payment.

NPCI

National Payments Corporation of India is a non-profit organization that is registered under section 8 of the Companies Act 2013. It is the umbrella organization that looks after the matter of retail payments and settlement systems in India.

Month: Current Affairs - August, 2020