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Markets regulator Sebi on Tuesday allowed payments banks to carry out the activities of investment bankers. The move is aimed at providing easy access to investors to participate in public and rights issues by using various payment avenues.
Non-scheduled payments banks, which have prior approval from the Reserve Bank of India (RBI), will be eligible to act as a banker to an issue (BTI), Sebi said in a circular. This is subject to fulfilment of the conditions stipulated in the BTI rules.
Further, payments banks registered as a BTI will also be permitted to act as self-certified syndicate banks, subject to the fulfilment of the criteria laid down by the Sebi in this regard from time to time.
“The blocking/movement of funds from the investor to issuer shall only be made through the savings account of the investor held with the payments bank,” Sebi said.
In a notification dated July 30, the regulator amended the Bankers to an Issue rules, thereby permitting such other banking company, as may be specified by the Sebi, from time to time, to carry out the activities of Bankers to an Issue (BTI), in addition to the scheduled banks.