The Best Interest Rates Paid By Payments Banks In India

In the last couple of years, the Indian Bank System has seen the rise of a new bank system, the payments bank. What is a Payment bank? Payments bank is an Indian new model of banks conceptualised by the RBI. These banks are different from the traditional banks in India. These banks come with some restrictions and need to follow different rules compared to the traditional banks operating in India under the supervision of RBI. The Reserve Bank of India has given the principle clearance to create a new payments bank under the Banking Regulation Act, 1949 to 11 companies operating in India.

However, currently, only 6 payments banks are operating and serving in India. Initially, 11 entities got the license to open and operate payments banks in the country but out of 11, 3 surrendered the license to RBI. The remaining 8 banks started their operations, however, in a few years other 2 also closed down their banks owing to some reason.

The account opening procedure in the Payments banks is easy and reliable as payments banks operates mostly through digitally on mobile phones. Having an idea of which payment bank offers the best interest rates is good before deciding on account opening.

The 6 payments banks operating in India

1. Airtel Payments Bank

Airtel Payments Bank was the first payments bank that started operating in India. It is a bank operated by India's one of the biggest telecom operators Bharti Airtel. This gave them the edge over others in terms of customers and reach. To open an account in Airtel payments Bank all you need is Aadhar-linked mobile for OTP, Aadhaar Number and PAN.

2. India Post Payments Bank (IPPB)

The IPPB is another payments bank operating in India at ground level. It is a division of India Post, which is owned by the Department of Post, which is part of the Ministry of Communications of India, Government of India. IPPB has a significant presence across the nation. The IPPB could be opened through the dedicated app launched by the bank for general operations such as payment and deposits. All you need is an Aadhaar-linked mobile number for OTP, Aadhaar number, and PAN card number to open and you are ready to start payment.

3. Fino Payments Bank

Fino Payments Bank or the Financial Inclusion Network And Operations Payments Bank is a 3rd bank that is still operating the payments bank in India at the national level. It also requires Aadhar Number, Aadhaar-linked mobile number and PAN card to open an account with the bank. It's easy and reliable as it offers some unique bank services to its customers.

4. Jio Payments Bank

Jio Payments Bank is another payments bank that has a strong backing of telecom customers. It's similar to Airtel Payment bank. The bank was banked by Reliance Industries, which also owns Jio Telcom, the biggest telecom operator in India. It began operations its operations in 2018.

5. Paytm Payments Bank

Paytm Payments Bank is India's one of the biggest payments bank services all over India. Account opening procedure in Payments Bank is easy and could be done over mobile with Aadhar and PAN. However, for full KYC you need to visit the Nearest KYC centre of PayTM Bank.

Paytm payments Bank has partnered with IndusInd Bank, which offer an FD facility to the Paytm bank customers on the excess amount set by the customer in the Bank app.

6. NSDL Payments Bank

National Securities Depository Limited (NSDL) is one of 11 applicants that received in-principle permission for the establishment of a payments bank by the RBI in India. The NSDL Payments Bank started its operation as a payments bank in India after getting approval from RBI in 2018. The NSDL is a financial organisation founded to hold security such as shares, bonds etc.

The Interest rates paid by the payments banks are as follows:

Payments Banks	Interest rates
Airtel Payments Bank	6.00%
India Post Payments Bank (IPPB)	2.50%
Fino Payments Bank	2.75%
Jio Payments Bank	3.50%
Paytm Payments Bank	2.50%
NSDL Payments Bank	5.00%