Govt planning to regulate payment systems

The central government is planning to introduce a bill to empower the Reserve Bank of India (RBI) to regulate and oversee various payment and settlement systems including those used by credit card companies and national bodies like Clearing Company of India.

"We intend to bring a bill to regulate the payment systems," Finance Minister P Chidambaram told the Lok Sabha today while replying to questions on the credit card industry.

The Payment and Settlements Bill, cleared by the cabinet yesterday, provides for setting up a new National Payments Company that would take over the retail payment systems.

The various retail payment systems in operation include card-based paper system, manual paper-based clearing and fund transfer system.

Pawan Kumar Bansal, Minister of State for Finance, said representations have been received from the public about rejection of their loan or credit card applications without assigning reasons.

The government has advised the RBI and Indian Banks' Association (IBA) to take corrective measures to ensure that customers get efficient and hassle-free banking services at affordable charges, he said.

The IBA has issued a Fair Practices Code, which provides for furnishing reasons for rejection of loan applications.