SYDENHAM COLLEGE OF COMMERCE AND

ECONOMICS

B ROAD, CHURCHGATE, MUMBAI -40002

A Synopsis submitted on

Payment banking

And customer satisfaction: A Review

By

SABAH SHAIKH

TYBBI –SEMESTERVI

Roll no: 107

Under the guidance :

Dr. Radhika Iyer

University of Mumbai

2019 – 2020
INTRODUCTION

A bank is a financial institution licensed to receive deposits and make loans. Banks may also
provide financial services, such as wealth management, currency exchange, and safe deposit
boxes. There are two types of banks: commercial/retail banks and investment banks. In most
countries, banks are regulated by the national government or central bank.

Technology has transformed the way one banks or carries out business transactions. Fintech
has played an important role in the evolution of the Financial Services industry. Digital
Banking is fast becoming the preferred mode of operation among the millennial. It not only
reduces cash-based transaction but also leads to greater transparency and accountability,
benefitting the economy as a whole. This brings us to the whole new concept of Payment
Banks.

Payment Banks are a part of a special category of banks which are authorized to offer a
limited range of services to its customers, which include providing remittances and receiving
payments. Payments banks can issue services like ATM cards, debit cards, net-banking and
mobile-banking. The banks will be licensed as payments banks under Section 22 of the
Banking Regulation Act, 1949, and will be registered as public limited company under the
Companies Act, 2013.On 19 August 2015, the Reserve Bank of India gave "in principle
"licences to eleven entities to launch payments banks:

1) Aditya Birla Payments Bank

2) Airtel Payments Bank

3) India Post Payments Bank

4) Fino Payments Bank

5) Jio Payments Bank

6) Paytm Payments Bank etc,

Bharti airtel launched India first live payment bank named airtel payment bank in March
2017
NEEDS AND IMPORTANCE OF STUDY:

The present study focuses on payment banks . It also helps to know difference between
regular bank and payment banks. The purpose of the study is to investigate the awareness
level of payment. The present study tries to investigate how payment banks is becoming
popular.

OPERATIONAL DEFINITION:

A payments bank is like any other bank but operating on a smaller scale without involving
any credit risk. In simple words, it can carry out most banking operations but can’t advance
loans or issue credit cards. It can accept demand deposits (up to Rs 1 lakh), offer remittance
services, mobile payments/transfers/purchases and other banking services like ATM/debit
cards, net banking and third-party fund transfers

RESEARCH OBJECTIVES:

• To understand the concept of payment bank’s

• To investigate the awareness level of respondent towards payment banking.
• To examine the benefits and challenges faced by customer as regards payment bank
• To find out whether consumer prefer payment bank or regular bank for their banking
needs.

HYPOTHESIS:

• H1: There is a significant number of consumers who are aware of payment bank.
• H2: There is a significant number of consumers who prefer payment bank over regular
bank.

RESEARCH METHODOLOGY:
UNIVERSE: The universe for the present study comprises of all the customer in India who
are using payment bank service.

SAMPLE SIZE: The sample for the present study comprises of 100 respondents from
Mumbai

SCOPE AND LIMITATION:

• The study is confined only to the city of Mumbai .

• The research is based on the response of 100 customers only.

• Customer satisfaction is a subjective factor which may vary from time to time

TYPES OF DATA:

The present research customer primary and secondary data for purpose of study.

SOURCES OF DATA:
Primary Data is collected by distributing to the customer sample.

Secondary Data was collected from the various sources, Catalogues, Internet,

Magazines and Newspapers, journals , reference

LITERATURE REVIEW:

VISHAL R SANDANSHIVE, DR. VIVEK V KATDARE(2015 ) in their

research paper titled “Analysis of In-principle entities to act as payment bank :financial
inclusion perspective”
analysed the 11 entities functional areas which are approved under In-principle by RBI.
The paper also highlighted the benefits for the payment customers and to the telecom
entities. The main objective of the research was to know the role of payment banks in
the process of financial inclusion. Thus, the study concludes that telecom companies
 has greater advantage in partnering to the Payment Banks as they have already networks
reaching to the rural customers.

G. SIVA KRISHNA AND S. VENUGOPAL (2014) in their respective study titled “A

study on payment banking to improve customer base”.
The study was an attempt to analyse the customer perception, customer preferences and
customer satisfaction levels towards payment banking services. Based on the study, the
researchers concluded that with better understanding of customer perceptions, the
banks will be able to determine required actions to satisfy the customers.

NIDHICHANDARAN (2015) in the research paper titled “payment bank -a need

of digital India”
made a conceptual study on need of Payment Banks in India. The study was based on
secondary data. The researcher also focused on PPI (Pre-payment Instruments), a
conceptual study.The concept of payment bank is a great is a great initiation taken by
RBI as a part of financial inclusion .The present paper helps the payment banks
companies to create awareness among the people

DR. SRINIVASAN, PROF. SUBRAMANIAN (2012) in the research paper

titled “payment bank- a new landscape for Indian banking sector”
In his study detailed conceptual study of Payment Banks. The researchers mainly
concentrated on finding an answer to certain questions like who are these payment
banks, why do we need Payment Banks when we already have public, private, foreign
and cooperative banks, what are the value-added services rendered by payment bank
and so on. The researchers concluded there is much possibility in the near future to
open more Payment Bank Accounts in addition to their regular bank accounts.

Expected contribution:
Payment bank said to be a game changer because with the entry of payment banks, the
process of shifting money from bank accounts to wallets will become easier , and thus it is
extremely possible that many customers may open payment bank accounts in addition to their
regular bank accounts. many people are still not aware about Payment Banks, its services,
benefits and security norms. Hence, payment bank is yet to create a strong wave.

BIBLIOGRAPHY/REFERENCE:

• NidhiChandarana (2015), “Payment Bank – A need of Digital India”, Abhinav

National Monthly Refereed Journal of Research in Commerce & Management, Vol.
No 4, Issue 11.
• Vishal R Sandanshive, Dr. Vivek V Katdare, (2015), “Analysis of In-Principle
entities to act as Payment Banks: Financial Inclusion Perspectives”, International
Journal of Science, Technology and Management, Vol. No 4, Issue No12.
• G. Shiva Krishna (2014) “A Study on payment banking to improve customer base
with reference to HDFC bank Ltd, Eluru(A.P)”, International Journal of Research
and Computational Technology, ISSN .09755662,Vol.4, Issue 3.
• Dr. Srinivasan, Prof. M Subramanian (2015), “Payment Banks in India-Demystified”,
SSRG International Journal of Economics and Management Studies, Vol. No 2, Issue
6.
• World Bank, “Financial Inclusion Report World Bank,” Apr. 2016
• www.rbi.org.in
• http://www.thehindu.com/business/all-you-need-to-knowabout-payment
banks/article7561353.ece
• https://www.quora.com/What-is-the-difference-between-a-payment-service-
provider-and-a-payment- bank-in-India-Why-did-the-RBI-add-another-type-of-
entity-instead-of-extending-the-capabilities-for- PSPs
• https://en.wikipedia.org/wiki/Payments_bank