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Home SME News Bite: Payment Banks Decoded (VIDEO)
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SME News Bite: Payment Banks Decoded (VIDEO)

  • byRapti Gupta
  • May 8, 2017
  • 1 minute read
Payment Banks
(Last Updated On: June 8, 2021)

Payment Banks are small institutions that enable easy banking. Your phone service provider or digital wallet can become a BANK!

What Can You Do at Payment Banks:

  • Deposit up to Rs.1,00,000 only
  • ATM, Debit Card services
  • Buy Mutual Funds and Insurance
  • Mobile Banking services (transfer money, receive payments etc)
  • No loans or Credit Cards

Should your small business get a Payment Bank Account?

Have you been thinking about getting a payment bank account? Here are the pros and cons of opening an account with payment banks:

The Good

  • If you have 5-6 employees, you can open salary account instead of paying in cash
  • Higher interest rate on savings account – around 7%
  • Simpler KYC norms
  • Banking services at doorstep
  • Risk of fraud low because of capped deposit balance
  • Zero balance account
  • Cashback and discount offers (acts as wallet+bank)

The Bad

  • No credit availability
  • Existing banks already offer services like payment banks (ICICI Pockets etc)
  • RBI can revoke a payment bank’s license fairly easily than a regular bank
  • You cannot make investments via payment bank account.
  • Your mobile number is not your account number. Collecting payments would be a hurdle.

Payments Bank Account – Yay? Or Nay? Tell us what you think in the comments. Want an easier way to collect payments online? Try the Instamojo experience today!


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  • payment bank deposits
  • payment bank features
  • Payment banks
  • what s a payment bank
Rapti Gupta

Content Marketer. Serious Nonsense Enthusiast.

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