Fino Payment banks launches “Bhavishya” savings account for minors. This savings account can be open by paying a nominal amount. The bank will introduce the Bhavishya savings bank account firstly, in the states of U.P., M.P., and Bihar.
Before going through it in detail, let us look into what the payment bank is?
Nachiket Mor committee on 7th January, 2014 submitted its final report to RBI. Among its various recommendations, it recommended the formation of new category of bank called payment banks. RBI issued a guidelines on 24th November, 2014 for setting up payment banks in country. The main objectives of setting up payment bank is to increase financial inclusion in the country.
what is Bhavishya savings account for minors
Salient features of the Payment banks are:
- The minimum capital requirement is Rs. 100 Crore
- The share of promoters should be at least 40% for the first five years
- The voting rights are regulated by Banking Regulation Act, 1949
- Initial deposits of Payment bank was fixed at Rs. 1,00,000/- but it may raise subject to bank performance
- 25% of its branches must be in rural areas
- Payment banks are authorise to open both savings and current account of the customers
- Payment banks can issue Debit card or ATM card to their customers but cannot issue credit cards
- It cannot provide loans facilities to their customers
- Payment banks have to invest 75% of demand deposits in government treasury. Whereas, the remaining 25% they have to keep in current and fixed deposits with other commercial banks
Fino Payment bank:
Fino was initially formed as domestic payment company under the supervision of ICICI bank and later became an independent banking company. There are total of 410 branches of Fino Payment bank presently working in India. Fino Payment bank now launch the Bhavishya savings account scheme for minors aged between 10 to 18. The bank will initially launch the scheme for Uttar Pradesh, Madhya Pradesh and Bihar. Later they are thinking for scheme expansions in other states too.
The bank said as per 2011 census, India’s population in the age group of 10 to 19 was above 25 crores and in 2021 it is expected to grow more. Therefore, this provides an opportunity to bank for expanding their banking business. There will also be a great advantage to parents for putting their children in a habit of savings.
Chief Operating Officer of Fino Payment bank said that they are expecting to open around one lakh Bhavishya saving account by the end of FY21. No minimum account balance is necessary and a free debit card will be issue for ATM transactions. For security reasons, minor must have mobile number different from that of parents. Furthermore, after attaining majority i.e at the 18 years of age Bhavishya savings account will be upgraded to regular savings account on the re-submission of KYC and updated information.
What is Bhavishya savings account for minors