RBI Releases Draft Framework For Self-Regulatory Body For Payment System Operators

The Reserve Bank of India (RBI) on Tuesday released the draft framework for grant of recognition to an industry association as a Self-Regulatory Organisation (SRO) for Payment System Operators (PSOs). The SRO will cover operators in all segments of payment systems and will be expected to observe best practices on security, customer protection and competitiveness, the RBI said.

Also, the SRO will serve as a two-way communication channel between the PSOs and the central bank, and work towards establishing minimum benchmarks and standards in the payments space, apart from helping disciplined behaviour by members, the central bank said.

In the February 6 monetary policy, the RBI had first proposed to set up an SRO. “With substantial growth in digital payments and maturity gained by entities in the payment ecosystem, it is desirable to have an SRO for orderly operations of the entities in the payment system,” the RBI had said.

The RBI will accept public comments on the draft framework till September 15.