Payment Banks Research Articles

A Study on the Funds and Investment Management of the Dehradun Urban Co-Operative Bank in Uttarakhand

Cooperative credit can be broken down into Urban Co-operative Banks (UCBs) and Rural Cooperative Banks. Rural cooperatives play a big part in the credit delivery system in rural areas. Urban Cooperative Banks (UCBs) try to get savings from middle and low-income people and give them money to people who need it. People who work for UCBs and rural cooperative credit banks are regulated by the Reserve Bank of India and NABARD, respectively. Both are regulated by the State Government in regard to certain types of work they do.The research demonstrates that in the majority of situations, the bank handles money and investments more effectively and efficiently. On the other hand, the bank’s high cost deposits are on the higher side, which will have a stronger impact on the bank’s profit and profitability in the long run. To provide more contemporary banking services and to attract new consumers, the bank should place a premium on providing high-quality services. Delivering high-quality services and transitioning from conventional to digital banking will undoubtedly bring value to the bank. Developing an appropriate plan to address difficulties such as NPA management, increasing competition from new generation banks, small and payment banks, would undoubtedly increase the bank’s operating efficiency.

Financial Inclusion Measures of the Indian Government

This comprehensive study explores the multifaceted landscape of financial inclusion measures undertaken by the Indian government. By examining initiatives such as the Pradhan Mantri Jan Dhan Yojana (PMJDY), Direct Benefit Transfer (DBT), digital payment systems, small finance banks, payment banks, and financial literacy campaigns, the study delves into the objectives, implementation strategies, achievements, and challenges of these measures. The analysis highlights the transformative impact of financial inclusion on marginalized populations, while also addressing persisting challenges such as low financial literacy and inadequate infrastructure. The study underscores the necessity of collaborative efforts among government bodies, financial institutions, technology enablers, and civil society organizations to ensure a holistic and sustainable approach to financial inclusion.

Adoption of payments banks: a grounded theory approach

Payments banks came into existence in India in 2015 when the Reserve Bank of India awarded licenses to eleven applicants to set up these banks specifically to further financial inclusion by providing small savings accounts and facilitating payments and remittances to the financially excluded population. As of March 2020, only six of these were operative and not very successful, both from the profitability and customer growth perspectives. This article seeks to understand the reason for payments banks not taking off as envisaged. Attributing this primarily to low adoption of payments banks by the financially excluded customer segments, this study uses a grounded theory approach based on data collected from interviews of target customer groups and of managers at some payments banks. The primary factors contributing to low adoption by the customer segments studied here, namely migrant labor and small vendors, have been identified as lack of awareness, lack of trust and lack of perceived need for their products/services. These factors arise due to inconsistencies between the business model design and the nature of the target audience. The article further discusses managerial and policy implications of these conclusions.

A study on fintech revolution in india: A review

Through innovation and technology, traditional financial services have undergone a significant transition. Today, technology seems to be a key component in the growth of digital economy. With the rising market and technical improvements, Indian banking sectors and financial service providers have purposefully adopted technology over the years to enhance client reach, service delivery, and operational work efficiency. However, the adoption rate of financial technology is still lagging below its potential. Therefore, there are gaps in the provision of financial services. Banks and financial institutions have learned that technology has the power to entitle current business conceptions rather than creating new business proposals themselves. However, the use of digital technologies to create new business opportunities and target underserved market niches is changing how financial technology companies are seen. FinTech is the term used to describe the proper application of financial technology to the delivery of new financial services and products to untapped market segments in a way that is both moral and effective. From a business model perspective, the financial technology sector is made up of technology companies that either work with well-established banks and financial institutions to offer essential customer and market data or strive to do away with intermediaries altogether. FinTech is attracting and increasing interest from investors, regulators, payment banks, NBFCs, traditional banks, payment service providers, broking and wealth management firms, insurance firms, and pure-play FinTech operators, to name a few of the sector's major players in India's financial services. The goal of this study is to discuss the various facets of fintech in India.

Effectiveness Of Payment Banks In Rural Area With Reference To Coimbatore District

Effectiveness Of Payment Banks In Rural Area With Reference To Coimbatore District

Acquaintance and Acceptance of Payment Banks among College Students During the Pandemic Period

Acquaintance and Acceptance of Payment Banks among College Students During the Pandemic Period

Banking System Paradox

Banking system has been the backbone of Indian economy. Banking industry has seen a drastic transformation in past two and half decades with emergence of new players in the form of new generation private sector bank, payment banks, non banking financial companies. Competition among service providers has lead to sustainability issues. Balancing between business expansion, risk absorbing capacity and profitability is important. Survival of the fittest is the rule of the game. Nationalization of private banks was done to expand the service base for common masses. Since independence public sector banks have played a key role in the development and balanced growth of all sections of the society. Public sector banks were supported by a league of few old generation banks that catered the niche segments across India. Kerala is the birth place of many old generation private sector banks. Old generation banks worked in line to the practices followed by the leading public sector banks. Indian Banking Association (IBA) was formed for bringing standardization among peer players across industry. Post liberalization era has originated many new generation banks are genetically modified hybrids. New variants are designed for specific objectives of profit maximization en-cashing available opportunities. Business expansion is based on profit criteria rather than social requirements. Ideologies have differed a lot across generations. Public sector banks and new generation private sector banks are operating with diverse organizational goals. This case study highlights the comparative scenario of private sector banks with that of public sector banks to understand the market dynamics in the game of performance and survival.

Payment Banks in India A comprehensive Analysis

Payment Banks in India A comprehensive Analysis

Effect of demonetization on microfinance industry in India

High-value denomination currency was scrapped off from the Indian economy on 8th November 2016, Rs. 500 and Rs. 1,000 currency notes were declared invalid at midnight hour. Taking such a bold step by Hon. Prime Minister of India Mr. Narendra Modi, means declaring 86% of cash in circulation an illegal tender overnight. This study is conducted on the immediate effect of demonetization on the microfinance industry in India and its after-effects in the later years. We have analyzed the data collected from the rural sector, on the collections and lending, impact on the farmers, how it has affected the small microfinance companies. We have also analyzed RBI’s initiative towards financial inclusion, Pradhan Mantri Jan Dhan Yojana (PMJDY), the emergence of new Small Finance Banks, Digital Banks, Payment banks, etc. We have critically analyzed the impact of cost versus the benefit from the demonetization exercise for the rural and microfinance industry. The aim of this study is to analyze the overall financial inclusion of the rural and small sectors towards the dream of a Cashless Economy.

Penetration of Payments Banks: A Case Study of India Post Payments Bank In District Muzaffarnagar of UP

Penetration of Payments Banks: A Case Study of India Post Payments Bank In District Muzaffarnagar of UP

Pradhan Mantri Jan Dhan Yojna and Financial Inclusivity: An Empirical Analysis

A financial system which is inclusive is deemed a pre requisite for sustainable development and growth which encompasses all sections of the society. Financial inclusivity has been a top policy prerogative and several initiatives launched to ring in financial inclusion. From the nationalization of Banks in late 1960s till the very recent small payment banks and PMJDY, multiple initiatives have been introduced to ensure 100% inclusion. The present study has been conducted to know the progress made through the much-coveted PMJDY scheme of the government. Also, an attempt is made to know from the business correspondents, their experiences both pre- and post-implementation of PMJDY. The study is based on both primary and secondary data. While the secondary data has been collected from the website of PMJDY, primary data is collected from the business correspondents. The secondary data is analysed using CAGR, paired two sample t test is used to analyze the primary data. It has been found that there is a significant improvement in the number of households covered through PMJDY and there has been a significant improvement in usage of financial services as is reflected by the increase in the amount which is deposited in BSBDA accounts. Also, as per the experiences of business correspondents there is a significant improvement in the banking habits of newly included. The implication of the study is that it gives indications to the policy makers and the practitioners about the course of action to be taken to increase the usage of the financial services now that there has been a significant improvement in accessibility.

A Study on Sustainability of Payment Banks in India using Technology Acceptance Model

Payment banks are new era banks that provide limited services but with simple access. The Reserve Bank of India established it with an aim to offer remittance services to migrant labor workforce, low-income households, small businesses, and other unorganized sector entities. Awareness plays a major role in the mindset of the people towards the digitalized mode of the payment system. Payment banks are currently facing many challenges as they are not allowed to lend money. Their major source of income comes only from the interest of the government securities in which they can invest. Despite all these, payment banks are struggling with huge losses and their existence is in a dubious situation. Six out of eleven payment banks are assessing the option of converting themselves into a small finance bank. In this context, the study focusses to analyze the key factors contributing to sustainability of the of payment banks. A measure of the trust and its role was used to test the relationship along with perceived usefulness and perceived ease of use. Actual usage was observed as a perception of usefulness and ease of use among the respondents. Payment banks offer a paradigm shift in making India a digital economy.

Analysing the factors that affect the adoption of payments bank services in India: an analytic hierarchy process approach

Mobile financial services (MFS) provide added convenience to existing bank customers in developed markets, and act as a vehicle to achieve financial inclusion in developing countries. The Government of India launched a new MFS, i.e., payments banks (PB) with an objective of increasing the penetration level of banking services in the country. The purpose of the current study is to identify the most significant factors which influence the Indian customers to adopt PBS. The paper by carrying out literature review first identifies the factors which effect the customers' adoption of PBS and then using analytic hierarchy process (AHP) tries to prioritise them based on their relative importance. AHP was applied on the data and the results obtained reveal that 'perceived benefits' are of utmost importance for the adoption of payments banks services. Moreover, 'monetary benefits', 'time saving', 'trust in service provider', and 'financial risk', are the topmost four sub-factors for the enabling effective adoption of PBS.

Factors Influencing the Adoption of Payment Banks in India Using an Extended TAM

The purpose of this study is to investigate the factors that shape behavioural intentions of customers towards the adoption of payment banks in India. The conceptual framework of study is based upon integration of technology acceptance model with initial trust, facilitating conditions and social influence. Further, the study tests the moderating role of age, income and self-efficacy on the relationships between dependent variable and associated predicted variable. A total of 507 responses were collected from the state of Punjab (India), using convenient sampling technique and were analysed using the structural equation modelling (SEM). The results revealed that perceived ease of use had the highest impact on the behavioural intentions, followed by initial trust and social influence. Facilitating conditions and perceived usefulness showed lower impact on the behavioural intentions towards the adoption of payment banks. Also, moderation analysis revealed that self-efficacy moderates the relation of perceived ease of use and perceived usefulness with behavioural intentions. Results imply that marketers should collaborate with developers to provide the customers with easy-to-operate solutions along with robust customer support mechanism to escalate the adoption intention of those having lower self-efficacy levels.

When friends become enemies: co-opetition relationships between banks and third-party payment providers

PurposeThe purpose of this paper is to investigate the conditions under which working with an incumbent downstream competitor could be a beneficial strategy for upstream firms as the case of the relationship between banks and third-party payment providers.Design/methodology/approachUsing a game model, this study considers a market with two upstream firms (banks) and two downstream firms (third-party payment providers). One downstream firm is an incumbent that poses a competitive threat to the upstream market, and the other downstream firm does not.FindingsThe results show that the optimal decision for banks depends on the number of loyal users the incumbent third-party payment providers and banks have. When the bank has more loyal users than the competitive third-party provider to a certain level, it would terminate cooperation with the provider; otherwise, the bank would maintain cooperation. This is true whether the duopoly banks are symmetrical or asymmetrical.Originality/valueThis study makes contribution to the theory of co-opetition lies in the fact that it examines a special case of competition and cooperation between vertical enterprises in the bank context. This study investigates how the upstream firms do when threatened by a downstream firm while the upstream firms have other options. This study also contributes to bank marketing theory through providing explanations for some of the incomprehensible cooperation in China's payment market, which is characterized by consumer loyalty. This study extends previous new-entry competition for banks by differentiating between incumbent and new-entry downstream firms.Peer reviewThe peer review history for this article is available at: https://publons.com/publon/10.1108/IJBM-11-2019-0414

A STUDY ON EVOLUTION OF PAYMENTS BANKS IN INDIA

A STUDY ON EVOLUTION OF PAYMENTS BANKS IN INDIA

Can microsavings work without microcredit? A case study of India Post Payments Bank

AbstractMicrosavings institutions that cannot provide microcredit are unlikely to be self‐sustaining. Payments banks are Indian microfinance institutions that can collect microsavings, but cannot give microcredit. They have been mainly unsuccessful owing to low spreads between interest given to savers and interest received from the reserve bank or commercial banks on interbank deposits. The commission income from transfer payments is too low to pay the high overheads of rural outreach. Payments banks would like to transform themselves into small savings banks that can provide microcredit.

Payment Banks: Digital Revolution in Indian Banking System

Digital revolution in India has brought paradigm shift in the banking system and financial transactions due to online payment. Payment gateways, e-commerce applications and other benefits boost smartphone users towards digital transactions. This study focuses on identifying factors important for customers to use payment banks for transaction. The identified dimensions for the usage of payment banks are; user friendly, convenience, cost effectiveness, security and easy cash management. People look for the aforesaid factors while they transact through payment banks. To validate the factors and check the model fit, a confirmatory factor analysis was run using AMOS. The analysis confirms constructs convergent validity and reliability, and model fit.

The Impact of Customers Awareness level on the Sustainability of Payment Banks in India

The Impact of Customers Awareness level on the Sustainability of Payment Banks in India

A Critical Study of Payments Banks in India

The Demonetization in the year 2016 has played a key role in changing the manner how we spend our money. It has also revolutionized the banking services. This has been made possible because of a monumental change in the data tariff regime due to the entry of Jio in the telecommunication market. The 1st Narendra Modi Cabinet’s policy of ‘Digital India’ has also paved the way for these online platforms. The aim of this paper is to study the origination of Payments banks in India as envisioned by the “Committee on Comprehensive Financial Services for Small Businesses and Low Income Households.” This committee was formed by the Reserve Bank of India in the year 2013 and headed by Nachiket Mor. The objective of the panel was to study various aspects of financial inclusion in India. The panel submitted its final report on 7 January 2014. This paper also studies the aims and objectives of the Payments Bank, the group of customers that it seeks to serve and the various services that it provides to its customers. There has been a meteoric rise in the user base of payments banks in the last two years. There are currently seven active payment banks in India like Jio Payments Bank, Paytm Payments Bank and Airtel Payments Bank to name a few. Since any banking services in India is not possible without the RBI’s approval, this paper is also aimed at reviewing the validity of Payments Bank as per the law. It also discusses the guidelines of Reserve Bank of India regarding the payments bank.