Which of the following are correct differences between a Payment bank and Small Finance Bank 1 Small...........

Economic Affairs Types of Banks and Banking

Which of the following are correct differences between a Payment bank and Small Finance Bank?

1. Small banks can accept all types of deposits like a commercial bank ( savings, current, fixed deposits, recurring deposits etc) while Payment banks can take deposits only on current & savings account.

2. Small Finance bank can undertake lending activity while payment banks cannot lend money.

Select the code from below:

1 only

2 only

Both

None

छोटे Courses बड़े Results

Master Types of Banks and Banking

Prepare through Micro-courses

Try Now

Explanation:

Similarities between Small Finance Banks & Payment Banks:
1. Minimum Paid Up capital should be 100cr.
2. FDI limit will be same as amended by govt time to time.
3. Initially The promoters share should be 40 percent. (Though different after some years).
DIFFERENCES b/w Payments & Small Finance Banks:
1. In Payment Banks , Promoters Share should be 40 % for first Five 5 years from the date of commencement of business Whereas In Small Finance Banks it should be 40% in starting Then can be gradually brought down to 26% in 12 years.
2. Small Finance Banks Are mainly For Lending In priority Sector Areas, Small Finance Banks will have to lend 75 % of their ANBC to PSL areas. Whereas payment Banks are not allowed to lend.
3. Small Finance Banks are just like Universal Banks so they can accept all type of deposits, FD, RD, Savings & Current. And also required to maintain SLR & CRR norms. Whereas the Payment Banks can only accept Demand Deposits and can hold 100,000 INR per person.
4. Payment Banks can Issue ATM, Debit cards but can’t Issue Credit Card. Along with they can serve various banking products as Mutual funds Unit, insurance, etc.
5. Payment banks Would Have to Invest 75 % of their ANBC in government securities having maturity of One Year.
6. Small Finance Banks will be able to lend Advances Upto 25 Lakhs.