"Payment banks is a new model of banks conceptualised by the Reserve Bank of India (RBI). These banks can accept a restricted deposit." When can RBI grant full license to an entity as payment bank ?

RBI follows a two-stage licensing process for Payments Banks under its Guidelines for Licensing of Payments Banks: RBI issues initially 'in-principle' licences to the entity subject to fulfilment of terms and condition, which are includes To be registered as a public limited company under the Companies Act, 2013. Payment Banks cannot form subsidiaries. For the first five years, the promoter's stake to remain at 40% at minimum. Foreign shareholding will be allowed in these banks as per extant FDI norms. The voting rights will be regulated as per provisions of The Banking Regulation Act 1949. [Voting rights are restricted at 10% for any one share holder. RBI has the discretion to raise this to 26% on merits.]. If there is any acquisition of more than 5% shares this will require prior RBI approval. The majority of the bank's board of directors should consist of independent directors, appointed according to RBI guidelines. The bank should be fully networked from the beginning. Initially, the deposits will be capped at ₹1,00,000 per customer, but later it may be raised on the basis of performance of the bank. No lending activity is permitted. Bank can accept utility bills. A quarter of its branches should be in unbanked rural areas. After fulfilment of all terms and conditions during the prescribed time period, RBI issues the full license to the entity as payment bank.