India’s banking landscape has evolved significantly with the introduction of payment banks. You might be wondering, how many payment banks are there in India today? This article will guide you through the current count, what payment banks do, and why they matter to you.
We’ll explore the list of active payment banks, their unique features, and how they differ from traditional banks. By the end, you’ll have a clear understanding of payment banks and their growing role in India’s financial ecosystem.
What Are Payment Banks?
Payment banks are a new type of bank in India designed to increase financial inclusion. They focus on providing basic banking services to people who may not have easy access to traditional banks.
These banks can accept deposits, offer remittance services, and issue debit cards. However, they cannot lend money or issue credit cards. This limitation helps them focus on safe, low-risk banking services.
Key Features of Payment Banks
- Accept deposits up to ₹2 lakh per customer
- Provide savings and current accounts
- Offer mobile banking and digital wallets
- Facilitate money transfers and bill payments
- Issue debit cards but no credit cards
- Cannot provide loans or credit facilities
Payment banks mainly target low-income groups, small businesses, and rural customers. They use technology to reach people in remote areas where traditional banks are scarce.
How Many Payment Banks Are There in India?
As of 2025, India has 11 licensed payment banks operating across the country. The Reserve Bank of India (RBI) granted licenses to these banks to promote financial inclusion and digital payments.
Here is a list of the payment banks currently active in India:
| Payment Bank Name | Parent Company/Promoter |
| Airtel Payments Bank | Bharti Airtel |
| India Post Payments Bank | India Post |
| Fino Payments Bank | Fino PayTech |
| Jio Payments Bank | Reliance Jio |
| Paytm Payments Bank | Paytm |
| NSDL Payments Bank | National Securities Depository Limited |
| Aditya Birla Payments Bank | Aditya Birla Group |
| Saraswat Bank Payments Bank | Saraswat Bank |
| Vodafone M-Pesa Payments Bank | Vodafone Idea Limited |
| NSDL Payments Bank | National Securities Depository Limited |
| Unity Small Finance Bank (Payment Bank services) | Unity Small Finance Bank |
Note: Some banks operate as small finance banks but also offer payment bank services.
Why Did India Introduce Payment Banks?
India introduced payment banks in 2015 to solve specific challenges in the banking sector:
- Financial Inclusion: Many Indians, especially in rural areas, lacked access to banking services.
- Digital Payments: The government wanted to boost digital transactions and reduce cash dependency.
- Safe Deposits: Payment banks provide a safe place for small savings without the risks of informal savings.
- Low-Cost Banking: They offer affordable banking services using mobile and digital platforms.
The RBI issued licenses to 11 entities after a rigorous selection process. These banks were chosen for their ability to leverage technology and reach underserved populations.
How Do Payment Banks Work?
Payment banks operate mainly through digital channels like mobile apps, USSD codes, and online portals. They also have physical outlets or agents in villages and towns.
Here’s how you can use a payment bank:
- Open an Account: You can open a savings or current account with minimal paperwork.
- Deposit Money: Deposit limits are up to ₹2 lakh per customer.
- Send Money: Transfer funds instantly to other bank accounts or mobile wallets.
- Pay Bills: Pay utility bills, recharge mobile phones, and make other payments.
- Withdraw Cash: Use debit cards or visit agents to withdraw money.
These banks use technology to keep costs low and provide quick services. They often partner with telecom companies or digital platforms to expand their reach.
Differences Between Payment Banks and Traditional Banks
Understanding the difference between payment banks and traditional banks helps you choose the right service.
| Feature | Payment Banks | Traditional Banks |
| Deposit Limit | Up to ₹2 lakh per customer | No limit |
| Lending | Not allowed | Allowed |
| Credit Cards | Not issued | Issued |
| Services Offered | Basic banking, payments, remittances | Full banking services including loans, investments |
| Branch Network | Limited, mostly digital | Extensive physical branches |
| Target Customers | Low-income, rural, small businesses | All customer segments |
Payment banks focus on simple, safe banking services. Traditional banks offer a wider range of products but may not reach remote areas as effectively.
Benefits of Using Payment Banks
Payment banks offer several advantages, especially for people new to banking or living in remote areas.
- Easy Account Opening: Minimal documentation and quick process.
- Low Minimum Balance: Often no minimum balance requirement.
- Digital Access: Manage accounts via mobile apps or USSD codes.
- Secure Transactions: Regulated by RBI, ensuring safety.
- Affordable Services: Low or no fees for basic banking.
- Financial Inclusion: Access to banking for underserved populations.
For example, India Post Payments Bank has millions of customers in rural India who previously had no bank accounts. Similarly, Airtel Payments Bank leverages its telecom network to reach millions of users.
Challenges Faced by Payment Banks
Despite their benefits, payment banks face some challenges:
- Limited Revenue Streams: Without lending, they rely on transaction fees and commissions.
- Customer Trust: Some customers prefer traditional banks for security.
- Competition: Digital wallets and fintech companies compete for the same customers.
- Technology Barriers: Not all customers are comfortable with digital banking.
- Regulatory Restrictions: RBI rules limit their growth potential.
Payment banks are working on innovative solutions like partnerships with fintech firms and expanding agent networks to overcome these challenges.
The Future of Payment Banks in India
Payment banks are expected to grow as India moves toward a cashless economy. The government’s push for digital payments and financial inclusion supports their expansion.
Here are some trends shaping the future:
- Integration with UPI: Payment banks are increasingly integrating with the Unified Payments Interface for seamless transfers.
- Partnerships: Collaborations with fintech startups to offer more services.
- Technology Upgrades: Use of AI and machine learning to improve customer experience.
- Expansion in Rural Areas: More agents and digital literacy programs.
- New Products: Introduction of micro-insurance and pension products.
The RBI may also review regulations to allow payment banks to offer more services while maintaining safety.
How to Choose the Right Payment Bank for You
If you want to open an account with a payment bank, consider these factors:
- Network Coverage: Choose a bank with a strong presence in your area.
- Digital Platform: Look for easy-to-use mobile apps or websites.
- Customer Service: Check reviews and support availability.
- Fees and Charges: Compare transaction fees and minimum balance requirements.
- Additional Services: Some banks offer loyalty programs or bill payment options.
For example, if you are a frequent mobile user, Airtel Payments Bank or Jio Payments Bank might be convenient. If you prefer government-backed security, India Post Payments Bank is a good choice.
Conclusion
Now you know that India has 11 payment banks licensed by the RBI. These banks play a vital role in bringing banking services to millions of people who were previously excluded. They focus on simple, safe, and affordable banking through digital channels.
Payment banks are not a replacement for traditional banks but a complementary service that helps expand financial inclusion. As technology advances and regulations evolve, payment banks will continue to grow and offer more benefits to customers across India.
FAQs
How many payment banks are currently operating in India?
There are 11 payment banks currently operating in India, licensed by the Reserve Bank of India to provide basic banking services.
Can payment banks provide loans or credit cards?
No, payment banks are not allowed to offer loans or credit cards. They focus on deposits, payments, and remittance services.
What is the maximum deposit limit in a payment bank?
The maximum deposit limit per customer in a payment bank is ₹2 lakh.
Are payment banks safe to use?
Yes, payment banks are regulated by the RBI, ensuring that your deposits and transactions are secure.
How do payment banks help in financial inclusion?
Payment banks use technology and agent networks to reach underserved populations, providing easy access to banking services in rural and remote areas.
