RBI has notified the Operating Guidelines for Payment Banks. In effect, payments banks and small finance banks have been allowed to use digital banking to open bank accounts. RBI has also permitted mobile phone users to open bank accounts with the payments banks promoted by telecom companies seamlessly, provided all the KYC (know your customer) formalities are already met. Further, payments banks can open accounts without a wet signature, relying completely on the digital signatures and electronic verification, which makes on-boarding of customers easy for geographically distant places where opening a physical branch might not be viable. However, Payments banks will be allowed to participate in call money and CBLO market as both borrowers and lenders.

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