Why in news?

• The Payments Regulatory Board (PRB) is a six-member board established by the Reserve Bank of India (RBI) to regulate and oversee the functioning of payment systems in India.
• It replaces the earlier Board for Regulation and Supervision of Payment and Settlement Systems (BPSS) and derives its powers from the Payment and Settlement Systems Act, 2007.

Composition and Structure

• Chaired by the RBI Governor.
• Includes two other RBI representatives: the Deputy Governor and the Executive Director in charge of Payment and Settlement Systems.
• Three nominees from the Central Government who are experts in payment systems, IT, cybersecurity, and law.
• The RBI’s Principal Legal Adviser is a permanent invitee.
• Members serve a non-renewable four-year term.

Functions and Authority

• Regulates and supervises payment systems, including clearing corporations, card networks, ATM networks, prepaid payment instruments, and payment aggregators.
• Can make rules and give instructions to payment system operators to ensure efficiency, safety, and reliability.
• Supported by RBI’s Department of Payment and Settlement Systems (DPSS), which reports directly to the PRB.
• Decisions are taken by majority vote, with the chairperson having a casting vote in case of ties.
• Meets at least twice a year.

The PRB marks the first time the government has formal representation in regulatory oversight of India’s payment infrastructure, reflecting the growing importance and complexity of the digital payments ecosystem in India.

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