Now Paytm, PhonePe Customers Can Add up to Rs 2 lakh In Wallets

The Reserve Bank of India (RBI) announced that small payments banks can now allow individual customers to keep up to Rs 2 lakh in their accounts. Payments banks had previously persuaded the RBI to reconsider the deposit limit for customers. Payment banks had requested that the deposit limit be raised from Rs 1 lakh to Rs 5 lakh.

Earlier "Guidelines for Licensing of Payments Banks," which were published on November 27, 2014, allow payments banks to hold a maximum balance of one lakh per individual customer.

Payment banks are currently a type of savings account that can provide deposit services but not loans to customers. Paytm Payments Bank, Airtel Payments Bank, and India Post Payments Bank are some of the most popular payment banks.

Unlike commercial banks, payment banks offer a zero balance or no minimum balance account without any additional or hidden fees, whereas commercial banks charge fees if the customer does not maintain a minimum balance in their account. A PB's main goal is to provide banking services to migrant workers, low-income households, small businesses, and other unorganised groups.

Following a review of payments banks' performance, it was decided to increase the maximum balance at the end of the day from 1 lakh to 2 lakh per individual customer in order to encourage their efforts for financial inclusion and to expand their ability to cater to the needs of their customers, including MSMEs, small traders, and merchants.