With the phenomenal increase in the volume of credit card payments and electronic clearing system, the government on Monday paved the way for creation of a national payment corporation by getting a bill passed in the Lok Sabha after seeking prior consent of the opposition.
Hours before piloting the Payment and Settlement Systems Bill in the lower House, finance minister P Chidambaram had a meeting with senior CPM and CPI leaders in foreign minister Pranab Mukherjee's office in Parliament. Explaining the purpose of the legislation, he reportedly said that a new entity would have to be created since the RBI had so long played the roles of both regulator and service provider.
The Left had objected to the creation of a new body to be controlled by private players on the ground of security and confidentiality. A compromise was worked out with the government agreeing to keep 51% of the shares in the new entity.
"We do not have a statutorily regulated system, this bill fills the void," the FM said introducing the bill in Lok Sabha. He said the purpose was to bring the payments system in the country at par with global standards.
In the proposed NPCI, public sector banks like SBI as well as private sector financial institutions will have stakes.
Source: TOI, 27-11-07
