The Reserve Bank of India has issued the Reserve Bank of India (Payments Banks – Undertaking of Financial Services) (Amendment) Directions, 2025, effective December 5, 2025, updating the Master Directions issued earlier in 2025. The amendments reflect stakeholder consultation and a review of earlier instructions, and aim to provide clarity and standardised governance for third-party arrangements by Payments Banks (PBs).
Key Highlights
- Updated Definition of Agency Business: Payments Banks may act as an agent of a Third-Party Product or Service Provider (TPPSP) to facilitate the sale of regulated financial products or services (e.g., insurance, mutual funds, pension funds) to their customers — without risk participation. Any agreement must be with a TPPSP and only regulated products or services may be offered. Covered activities may include marketing, sales, promotion, customer contact, grievance redressal and after-sale services.
- Clear Referral Services Norms: Under a “referral services” arrangement, a Payments Bank may simply refer its customers to a TPPSP by sharing information about the products/services. The bank must have no role in any process related to those third-party services; the bank’s name/brand must not appear in product/service documents. There should be no integration of TPPS processes into the bank’s platform or premises — except a simple redirect link to the TPPSP.
- The renumbering and re-definition ensures that “Financial Services Company” definitions are updated appropriately to reflect the new framework under sub-para (1A).
Link – https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=13211&Mode=0
