Top 5 Payment Banks in India 2024

Mar 30th 2024
List of Top 5 Payment Banks in India 2024

In recent years, India's banking landscape has undergone a significant transformation with the advent of payment banks. These specialised institutions are tailored to meet the diverse financial needs of the populace, providing innovative solutions and improved accessibility. Among them, payment banks have drawn particular attention due to their unique business models and extensive nationwide reach.

Understanding Payment Banks

In September 2013, the Reserve Bank of India (RBI) established a committee dedicated to examining the provision of financial services to low-income households and small businesses. The committee, led by Dr. Nachiket Mor, directed its attention to the unbanked population in need of fundamental banking services. 

In January 2014, Dr. Mor and his committee submitted a report recommending the establishment of Payment Banks. Following this recommendation, the RBI released the guidelines for Payment Banks in November 2014.

The Reserve Bank of India has established a framework for licensing small banks and other specialized banking entities. Such differentiated banks, which include local area banks and payment banks, are tailored to fulfil the credit requirements and remittance services for small businesses, the unorganized sector, low-income households, farmers, and the migrant workforce. 

The advent of Payment Banks has played a significant role in transforming the Indian financial landscape.

What are the Objectives of Indian Payment Banks?

The primary objective of RBI to set up payment banks in India is to cater to the underserved population’s savings accounts and transactional needs. Listed below are the main objectives of the payment banks in India:

  • Payment banks significantly enhance financial inclusion by offering small savings accounts and payment/remittance services to migrant labourers, low-income households, small businesses, and entities within the unorganized sector.
  • This is achieved by facilitating high-volume, low-value transactions in deposits, payments, or remittance services using secure technology.

What are the Characteristics of Payment Banks?

The characteristics of payment banks that make them unique are:

  • Payments Bank accepts money that you can withdraw anytime.
  • Initially, Payments Banks limited each customer to holding a maximum balance of INR 100,000.
  • They give out ATM and Debit cards but not Credit cards.
  • You can open savings accounts, and current accounts, and use mobile banking services with Payments Banks.
  • Payment banks can partner with other banks following RBI guidelines as Business Correspondents.
  • They provide payment and money transfer services through different methods.
  • Payments Banks also offer simple financial products like mutual fund units and insurance policies.

How are Payment Banks Different from Regular Banks?

Regular banks, also known as commercial banks, function differently from payment banks. The differences between payment banks and regular banks have been discussed in the table below:


Payment Bank

Regular/Commercial Bank

Deposit Amount

The deposit amount limit is INR 1 lakh

No deposit amount limit

Loans and Credit Cards

Can issue debit cards to the customers but not credit cards or loans (unless they have tie-ups with commercial banks)

Can issue debit cards, credit cards, and loans

Minimum Capital Requirement

Must have at least Rs 100 crore in capital, with promoters contributing at least 40% of the capital.

Must have a paid-up voting equity capital of Rs 500 crore.

Onboarding Process

Less time consuming

More time consuming

Minimum Balance Requirement

No minimum balance required

Must follow a minimum-balance protocol to avoid penalty

Interest Rate

Offer higher interest rate

Offer lower interest rate


Top 5 Indian Payment Banks that are Active in 2024

Currently, India has 5 Payment Banks: Airtel Payment Bank, India Post Payment Bank, Fino Payments Bank, NSDL Payment Bank, and Jio Payment Bank. There was another famous Payment Bank which was called Paytm Payment Bank but due to violations of RBI guidelines, the payment bank has been barred from offering payment bank services. 

This section contains all the details regarding the remaining payment banks in India which are currently active in 2024. 

1. Airtel Payments Bank

The Reserve Bank of India (RBI) granted Airtel Payments Bank its inaugural license in 2015. Operations commenced in September of that year. Bharti Airtel, in collaboration with Kotak Mahindra Bank, which holds a 19.9 per cent stake, established this Payments Bank. 

Further expanding its services, Airtel partnered with Bharti AXA General Insurance in 2019. In November 2016, Airtel Payments Bank inaugurated its pilot services in Rajasthan, introducing the concept of banking at your fingertips as ‘India’s First Payments Bank.’ The bank's headquarters are situated in New Delhi.

2. Fino Payments Bank

Fino Payments Bank commenced its operations on April 4, 2017, boasting a comprehensive network of over 400 branches and 25,000 banking points. Previously recognized as Fino Paytech Limited, a prominent payment solutions provider since 2006, it transitioned into a payments bank in 2017. Headquartered in Mumbai, the bank ardently adopts the tagline ‘Qadar Aapki Mehnat Ki’, underscoring its commitment to diligently serving its customers.

3. Indian Post Payments Bank

The India Post Payments Bank (IPPB) was established under the auspices of the Department of Posts, within the Ministry of Communication, and is wholly owned by the Government of India. IPPB was launched as a pilot project in Ranchi, Jharkhand, and Raipur, Chhattisgarh on January 30, 2017. 

Intending to achieve a nationwide presence by the fiscal year 2018-2019, IPPB successfully expanded its reach. It currently operates through an extensive network comprising a central location and 649 banking outlets, which are managed by Business Correspondents and cover various post offices throughout India.

4. Jio Payments Bank

Founded in November 2016 and backed by Reliance, Jio Payments Bank Limited is on a mission to transform India's financial inclusion landscape. Its objective is to create a platform that provides simple, accessible, and affordable banking services, with a special focus on the financially marginalized sectors. 

Jio Payments Bank is dedicated to comprehensively digitizing the payment systems and operates from its headquarters in New Delhi, driven by the ethos of being 'YOUR EVERYDAY BANK,' catering to all your payment, banking, and financial needs.

5. NSDL Payments Bank

The National Securities Depository Limited (NSDL) is one of the five operational payment banks in India. As per a press release from the RBI, its operations commenced on October 29, 2018. Classified as a non-governmental organization, NSDL Payments Bank operates as a 'company limited by shares.' 

With its headquarters in Mumbai, Maharashtra, the authorized capital of the corporation surpasses $29 million (200 crores). Embodying the values of 'Technology, Trust, and Reach,' NSDL Payments Bank positions itself as a pioneer in the financial sector, rooted in Mumbai.

What Happened to Aditya Birla Idea Payments Bank?

Aditya Birla Nuvo Limited, with 51% ownership, in partnership with Idea Cellular Limited, holding a 49% stake, founded Idea Payments Bank. Commencing operations in February 2018, the bank embarked on its journey in the financial sector. However, on 20 July 2019, the Aditya Birla Idea Payments Bank declared its decision to suspend operations, awaiting regulatory approval.



Q: Which payment bank is the best in India?

A: Since all the payment banks in India follow similar guidelines, it is hard to determine which is the best payment bank in India. Each bank can have its own merits or demerits. You are suggested to research thoroughly before opening a payments bank account.

Q: What is a payment bank?

A: A payment bank is similar to a regular (commercial) bank that operates on a smaller scale without the involvement of any credit risk. However, unlike regular banks, payment banks cannot issue credit cards or loans unless they have a tie-up with other regular banks. 

Q: How many payment banks are currently operational in India?

A: 5 payment banks are currently operational in India which excludes Paytm payments bank. 

Q: Can payment banks issue credit to customers?

A: No, payment banks are not authorized to issue credit to customers. They operate on a no-credit risk model, meaning they cannot provide loans or credit cards to their customers. Instead, they focus on facilitating transactions, especially for individuals who have limited access to formal banking services.

Q: What are some examples of services offered by payment banks?

A: Payment banks in India typically offer a range of services tailored to meet the needs of their target customers. These services include savings accounts, remittance services, bill payments, mobile recharge facilities, and access to government subsidies and benefits.

Q: What is the future outlook for payment banks in India?

A: The future outlook for payment banks in India is optimistic, considering the growing demand for accessible and affordable banking services, particularly in rural and remote areas. With technological advancements and increasing financial inclusion initiatives, payment banks are expected to play a significant role in expanding the reach of banking services to underserved populations.

Q: Are payment banks a viable option for individuals who require basic banking services?

A: Yes, payment banks serve as a viable option for individuals who require basic banking services but may not have access to traditional banking institutions. With their focus on affordability, accessibility, and ease of use, payment banks cater to the financial needs of a diverse customer base, including those in rural and semi-urban areas.

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