According to the regulations, banking licence and authorisation for wallet services are not tradable and transferable [View in browser]( [See all newsletters]( 15 February 2024 Any takeover of Paytm Payments Bankâs business likely to be a time-consuming affair [ ] The takeover process of Paytm Payments Bank may take longer time than expected as a lot of formalities need to be completed by the acquirer. According to the regulations, banking licence and authorisation for wallet services are not tradable and transferable. As on date, Paytm Payments Bank is one of the six payment banks (other five are Airtel Payments Bank, India Post Payments Bank, Fino Payments Bank, Jio Payments Bank, and NSDL Payments Bank). On January 31, the RBI directed Paytm Payments Bank to stop accepting deposits or top-ups in any customer accounts, wallets, FASTags, and other instruments after February 29. On February 12, RBI Governor Shaktikanta Das made it clear that clear that there is no review of the action taken against Paytm Payments Bank. A FAQ is expected to come any day and will deal with customer interest issues, said Das. - Also read: [Paytm hits record low after Macquarie downgrade on business viability concerns]( A slow process With such a stance, the buzz is that the business of Paytm Payments Bank will be taken over by other institutions. According to sources, if this happens, it will not be so quick. A source explained that taking over the business of a running entity by another entity requires a lot of formalities to be completed. âThere are two key components â banking licence issued to run a Payments Bank and authorisation for wallet services. Both are issued in the name of an entity and are non-transferable and non-tradable,â he said. This means, in the case of transfer, first both of these issued to the entity for Paytm Payments Bank must be annulled and second, a fresh application is to be made by the interested entity for bank licence and also for authorisation to run a wallet business. âThis is the mechanism applicable for all kind of banks. Similar thing happened when Punjab and Maharashtra Cooperative Bank (PMC) was acquired by Centrum-BharatPe consortium and now it is running the business under a new small Finance Bank, Unity,â said another source. - Also read: [No review of action taken against Paytm Payments Bank, says RBI Governor]( RBIâs guidelines for licensing of Payments Banks defines eligible promotes as existing non-bank Pre-paid Payment Instrument (PPI) issuers; and other entities such as individuals / professionals; Non-Banking Finance Companies (NBFCs), corporate Business Correspondents(BCs), mobile telephone companies, super-market chains, companies, real sector cooperatives; that are owned and controlled by residents; and public sector entities may apply to set up payments banks. Guidelines say apromoter/promoter group can have a joint venture with an existing scheduled commercial bank to set up a payments bank. However, scheduled commercial bank can take equity stake in a payments bank to the extent permitted under the Banking Regulation Act which is 30 per cent. Promoter/promoter groups should be âfit and properâ with a sound track record of professional experience or running their businesses for at least a period of five years in order to be eligible to promote payments banks. The minimum paid-up equity capital requirement  for payments banks is â¹100 crore. The promoterâs minimum initial contribution to the paid-up equity capital of such payments bank shall at least be 40 per cent for the first five years from the commencement of its business. Foreign investment also permitted in line with Private Bank. You Might Also Like [RBI asks card networks to halt card-based business payments on KYC, fund-use concerns]( [Money & Banking]( [RBI asks card networks to halt card-based business payments on KYC, fund-use concerns]( [India-UAE trade could touch $100 billion ahead of 2030]( [Economy]( [India-UAE trade could touch $100 billion ahead of 2030]( [Ola, Tata Motors continue to lead market in electric two-wheeler, passenger vehicle segments]( [Companies]( [Ola, Tata Motors continue to lead market in electric two-wheeler, passenger vehicle segments]( [January auto sales: Passenger vehicles, three-wheelers continue to top sales in FY24]( [News]( [January auto sales: Passenger vehicles, three-wheelers continue to top sales in FY24]( Stay informed Subscribe to businessline to stay up-to-date with in-depth business news from India [arrow]( Copyright @ 2024, THG PUBLISHING PVT LTD. If you are facing any trouble in viewing this newsletter, please try [here]( Manage your newsletter subscription preferences [here]( If you do not wish to receive such emails go [here](