RBI: Six member Payment Regulatory Board to regulate payment systems

A new six-member Payments Regulatory Board (PRB) has been notified by the Reserve Bank of India (RBI) that will regulate and supervise payment systems in India. The notification for the establishment of the Payment Regulatory Board was notified by the RBI on 21 May 2025.

The PRB will be India's highest policy-making body on the Payment System.

Which body will the PRB replace?

The Payments Regulatory Board (PRB) will replace the Board for Regulation and Supervision of Payment and Settlement Systems (BPSS) which was till now the highest policy making body on the Payment system in India.

• The BPSS is a subcommittee of the Central Board of Directors of the RBI.
• The Central Board of Directors is the highest decision-making body of the RBI.

Composition of the PRB

The PRB will have six members.

The RBI Governor will be the Chairman of the PRB.

• One Deputy Governor of the RBI, who is in charge of the Payment and Settlement system,
• One RBI official nominated by the  Central Board of Directors of the RBI.
• Three members nominated by the Central Government.

Other Invited Members 

• The Principal Legal Advisor of the RBI will be a permanent invitee to the meetings of the PRB.
• The PRB, on its discretion, can invite Law, Information Technology and Payment and Settlement system experts to attend the meeting of the PRB as permanent or ad hoc invitees.

Decision to be taken in the PBS

• The decision in the PBS will be taken by majority vote.
• Each member will have one vote
• In case of a tie, the Chairman of the PBS will cast the deciding vote.
• If the RBI governor is not available, the Deputy Governor will officiate as the Chairman of the PBS.

Meeting of the PBS

The PBS will have to meet at least twice a year.

Payment and Settlement in India

The provisions of the Payment and Settlement Act 2007 govern the Payment and Settlement in India. 

Only the RBI or a person authorised by the RBI can commence or operate a payment system in India.

The payment system includes the use of banking channels for making payments for the purchase of goods and services, excluding paper currency and coins.

The Payment system includes:

• Paper-based - Cheques, Drafts, Bankers Cheques, etc.
• Electronic-based: Electronic Clearing System (both debit and credit), Electronic Fund Transfer(EFT), National Electronic Fund Transfer(NEFT), Real-Time Gross Settlement (RTGS) system, Immediate Payment System (IMPS), Unified Payment Interface (UPI), etc.
• Prepaid system - e-wallets, etc
• ATM, Point of Sale Terminals, Cards (debit, credit), etc.

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