NSDL Payments Bank Added to RBI’s Second Schedule

In a notable advancement for India’s banking ecosystem, the Reserve Bank of India (RBI) has officially included NSDL Payments Bank Limited in the Second Schedule of the Reserve Bank of India Act, 1934. This inclusion, notified on June 19, 2025, and published in the Gazette of India on July 10, 2025, grants NSDL Payments Bank the status of a scheduled bank, enabling it to access RBI’s facilities and reflecting its growing importance in India’s regulated financial framework.

Background: What is a Scheduled Bank?

A Scheduled Bank is one that is listed in the Second Schedule of the RBI Act, 1934. These banks comply with specific conditions related to capital adequacy, governance, and public interest, as laid out by the RBI under Section 42(6)(a) of the Act. Scheduled status grants banks privileges such as,

• Eligibility to borrow from the RBI at the bank rate
• Access to liquidity support
• Membership in clearinghouses

About NSDL Payments Bank Limited

NSDL Payments Bank is headquartered at One International Center, Prabhadevi, Mumbai, a hub for modern financial services. As a payments bank, it focuses on,

1. Providing small savings accounts
2. Offering payment and remittance services
3. Serving low-income households, small businesses, and underbanked populations
4. The bank’s inclusion in the schedule is an endorsement of its financial stability, regulatory compliance, and public service mission.

Significance of Inclusion in the Second Schedule

• The RBI’s recognition has both operational and reputational implications:
• NSDL Payments Bank now joins other regulated financial institutions with enhanced credibility.
• The bank gains access to the RBI’s refinancing facilities and can expand its lending and payment ecosystem.
• It reinforces RBI’s confidence in the bank’s ability to maintain sound banking practices and support financial inclusion goals.

Legal Basis of Inclusion

The inclusion is authorized under Clause (a) of Sub-section (6) of Section 42 of the Reserve Bank of India Act, 1934. This section empowers the RBI to classify banks as scheduled based on,

• Their capital strength
• Ability to serve public interest
• Operational soundness and solvency
• The addition signifies NSDL Payments Bank’s alignment with these critical regulatory benchmarks.