Question
The payments banks in India are required to invest
____________ of funds in the government securities.Solution
The payments banks in India were established in order to achieve financial inclusion and these banks can only accept deposits. They cannot undertake lending activities. The RBI has given the approval to open such banks as per Section 22(1) of the Banking Regulation Act 1949. Payment banks have been set up as per the recommendations of the Nachiket Mor committee and they can only accept deposits upto Rs 1 lakh per individual. These banks have to invest at least 75% of its funds in the government securities.
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