Reserve Bank of India (RBI), the central bank of the country, has proposed to setup an umbrella entity/ entities for retail payment systems.

The central bank has published a draft framework for authorisation of the proposed pan-India entity.

RBI now seeks to public opinion on the draft framework from all stakeholders, a process that will continue to 25 February 2019.

The framework proposes creating an entity that will be incorporated in India under the Companies Act, 2013.

It will have a minimum paid-up capital of INR5bn. No promoter group shall have more than 40% investment in the capital of the entity, the framework proposed.

It is also required to maintain a minimum net-worth of INR3bn at all times.

Once formed, the entity will be responsible for managing new retail payment systems including ATMs, White Label PoS and Aadhaar based payments. It will also be tasked to develop new payment methods as well as related standards and technologies.

Additionally, the entity will operate clearing and settlement systems, and identify associated risks.

The umbrella organisation will also be in charge of monitoring retail payment system developments. It will also work to prevent any internal or external shocks that may adversely affect the system.

Currently, the National Payments Corporation of India (NPCI) is responsible for retail payments systems.