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Niti Aayog Proposes To Set Up Digital Bank In Country Know How Services Will Be Provided – Digital Bank

Business Desk, Amar Ujala, New Delhi

Published by: Deepak Chaturvedi
Updated Thu, 25 Nov 2021 02:20 PM IST

Summary

NITI Aayog Proposes To Digital Bank Set Up: Digital banks may soon come into existence in the country. For this, the government’s think tank NITI Aayog has proposed. These digital banks, completely dependent on the Internet, will eliminate the need for physical branches.

Digital banks may soon come into existence in the country. For this, the government’s think tank NITI Aayog has proposed. These digital banks, completely dependent on the Internet, will eliminate the need for physical branches. The Commission has released a discussion paper titled Digital Banks: A Proposal for Licensing and Regulatory Regime for India.

This paper states that digital banks are banks as defined in the Banking Regulation Act, 1949 (BR Act). In other words, these units will be able to provide all the services for which the BR Act empowers them, including issue of deposits, giving loans. The paper states that the RBI is empowered to grant licenses to banking companies directly under the Banking Regulation Act. At the same time, an additional step needs to be taken to create a system of licensing for digital business banks.

It has been said by NITI Aayog that India’s public digital infrastructure, especially UPI, has shown how to challenge the already established things. Significantly, UPI transactions have crossed the Rs 4 lakh crore mark in terms of value, while the figure of Aadhaar authentication has crossed 55 lakh crore.

Expansion

Digital banks may soon come into existence in the country. For this, the government’s think tank NITI Aayog has proposed. These digital banks, completely dependent on the Internet, will eliminate the need for physical branches. The Commission has released a discussion paper titled Digital Banks: A Proposal for Licensing and Regulatory Regime for India.

This paper states that digital banks are banks as defined in the Banking Regulation Act, 1949 (BR Act). In other words, these units will be able to provide all the services for which the BR Act empowers them, including issue of deposits, giving loans. The paper states that the RBI is empowered to grant licenses to banking companies directly under the Banking Regulation Act. At the same time, an additional step needs to be taken to create a system of licensing for digital business banks.

It has been said by NITI Aayog that India’s public digital infrastructure, especially UPI, has shown how to challenge the already established things. Significantly, UPI transactions have crossed the Rs 4 lakh crore mark in terms of value, while the figure of Aadhaar authentication has crossed 55 lakh crore.

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