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  1. Grant of payments banks licence arbitrary, says Subramanian Swamy

Grant of payments banks licence arbitrary, says Subramanian Swamy

BJP leader Subramanian Swamy today termed RBI's decision to grant in-principle approval to 11 entities for payments banks as "arbitrary and malicious".

By: | New Delhi | Published: September 5, 2015 6:30 PM
Subramanian Swamy

BJP leader Subramanian Swamy today termed RBI’s decision to grant in-principle approval to 11 entities for payments banks as “arbitrary and malicious”. (PTI)

BJP leader Subramanian Swamy today termed RBI’s decision to grant in-principle approval to 11 entities for payments banks as “arbitrary and malicious”.

“These were chosen from 41 applicants who wanted to start Payment systems. The manner in which 11 Payments Banks were shortlisted is inconsistent with the rule of law. It is not clear how the RBI came to the number of 11 payments banks, or why licences were denied to the others…

“The arbitrary and malicious decision (of RBI) appears to be a big scam…,” Swamy said in a statement.

From the very outset, he said, it is not clear why RBI chose to use the Banking Regulation Act, 1949, to licence Payments Banks when Parliament has made separate law for governing payments systems under the Payments and Settlement Systems Act, 2007.

Although the RBI stated that the 11 entities were chosen by an external evaluation committee, Swamy said “without casting any aspersions on the members of the committee, this is, sadly, not a due process of law”.

“There is no explanation on how the committee evaluated each criterion… ,” he said, adding RBI did not provide for review or appeal by rejected applicants. “This is also a violation of the rule of law”.

He further said that there would have been no problem had the RBI granted 30 payments banks licences instead of 11. “It would have promoted more competition and reduced costs to consumers”.

Payments Banks are allowed to collect deposits (initially up to Rs 1 lakh per individual), offer Internet banking, facilitate money transfers and sell insurance and mutual funds. Besides, they can issue ATM/debit cards, but not credit cards.

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  1. R
    Ramesh B
    Jun 15, 2016 at 2:55 pm
    I agree with Subramanian Swamy,Mr Rajan is guilty and a CBI inquiry should be conducted not only against the issues raised by Swamyji but also about his role in Cl IV recruitment scam during his regime in RBI.The recruitment has taken place vide a Private and secretive agreement and near and dear ones of the union leaders have been absorbed in RBI's lucrative job which is against the various Supreme court decisions and against Art 14 and 16 of the Indian Consution. During Mr. Rajan tenure as Governor RBI has become a Private shop.Will some lawyers wake up and file PIL against RBI for insulting the decisions of supreme court of India .
    Reply
    1. S
      srikanth
      Sep 5, 2015 at 11:23 pm
      if mr.swamy say ,there must be something fishy in it
      Reply
      1. Sudhakar Atre
        Sep 6, 2015 at 12:14 pm
        Mr.Swamy has shown courage to raise the issue which seemed to have missed by our intelligent analysts amid the fanfare with which the scheme was launched.There is one more angle to it the move will certainly snatch the CASA from banks putting their profitability under stress.It may also make difficult to meet priority sector targets as the low cost deposits will be lured by these new payment banks without any obligation to lend to priority sector causing socioeconomic distortions.
        Reply

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