RBI Mulls Licensing for Corporate Business Correspondents
Why in the news
RBI was weighing a licence regime that would put corporate BCs, many of them fintechs, under its direct regulation rather than leaving accountability with sponsor banks.
Key facts
- BCs: agents appointed by banks to deliver basic services where branches are not viable; the last-mile link to customers.
- Current rule: RBI regulates them only indirectly; banks answer fully for BCs they appoint.
Who can be a BC
- Individuals such as kirana owners, retired teachers, ex-servicemen, SHG members; NGOs and MFIs; companies and fintechs (Corporate BCs).
Services
- BSBDA accounts, cash deposit and withdrawal, AePS, DBT payouts, bill payments and remittances.
Concerns
- Some fintechs hold separate licences, such as PPI and Payment Aggregator, only for limited functions.
- Split oversight has left regulatory gaps.
Exam angle
- Account type opened by BCs: BSBDA.