How Paytm Payments Bank, Airtel Payment Bank are Different From Normal Banks


How Paytm Payments Bank, Airtel Payment Bank are Different From Normal Banks

Paytm recently launched their payments bank and at present there are four payments banks operating in India – Paytm Payment Bank, Airtel Payment Bank, India Post Payments Bank and FINO Payment Bank.

Digitalization has now truly taken the center stage. Banking and all other kind of financial services has made its presence in the digital space and it’s growing at a very fast pace; and the introduction of payments bank is one of them. Like normal banks, payments bank perform almost all banking operation but doesn’t engage in any credit providing service. They rather function on a smaller business scale compared with other banks. Few more differences are listed below:

Interest rates: The standard interest rate for commercial banks range from 3.5 – 6%. Paytm’s bank offers an interest rate of 4% on savings account and 7% on FDs whereas, India Post payments bank is offering between 4.5 – 5.5% for savings account. As of now, Airtel payments bank is providing the highest interest rate of 7.25% which is a very lucrative rate compared to other commercial banks. Some other small scale commercial banks such as RBL bank offers interest rate of 7% and Yes bank offers interest rate of 6.25% but that too depends on the deposit amount of the person.

As per the guidelines set by RBI, payments banks cannot lend money they can only take deposits or accept payments from the users. Banking experts consider by offering higher interest rates on deposits competition in this sector is definitely expected to rise.

Minimum Balance: Most banks levy a charge on its customers in case he/she fails to hold a minimum balance in their bank account. However, Paytm payments bank came up with zero balance account scheme where no minimum balance is required to be maintained by the user and that too without any charge. Few other banks and digital banking systems has also introduced this scheme but most bank charges for not maintaining minimum balance.

Charges: Usually banks charge a certain amount of fees for transactions made online, along with most payment banks. Among payment banks for online transfers, India Post payments bank charges Rs. 5 for IMPS and NEFT is free of cost. Airtel payments bank doesn’t charge anything for online transfers within the bank otherwise it charges 0.5% of the transferred amount. Paytm payments bank is not charging anything for any online transaction, all fund transfer services like IMPS, NEFT and UPI online transactions are free of cost for the user.

For cash withdrawals also, bank account holders are charged differently by different payments banks.  Paytm payments bank follows the standard RBI rules of cash withdrawal charges like to all other commercial banks in India. For the same, Airtel payments bank charges 0.65% of the withdrawal amount; India Post payments bank doesn’t charge any fee for withdrawals made from their own ATM or any Punjab National Bank’s ATM if not it too follows the same RBI rules.

Process: The application process to open a bank account of payments bank is made very easy as compared to other banks. A user can open his/her bank account in no time through their mobile applications just by providing details like Aadhar number with KYC verification.

India Post payments bank offers a free debit card with annual maintenance fee of Rs.100 from second year. Paytm payments bank is also providing digital debit card for free and an annual subscription charge of Rs.100 for the physical card. It is also giving its customers with checkbook for a charge of Rs.100.


  1. When all these companies are accepting deposits, and not lending, then how the companies canpay interest without earning out of it. Further, it the company earns on the deposits collected, then how do they earn

  2. smart phone or even normal phones are not as easy as all managements claim . When stuck up online no one comes to help- reading is not helping. no one can say in advance stuck up where and how? if you expect people like me to do everything online then run physical class room training at your cost and teach each and every step till the time the user can do it himself/ herself without asking for help having to read how to do it? . If customer is to do all your work and that is the reason to ask people to go online and do it . Then pay the customer wages/ salaries to do the work like you pay your staffers? . When i tried paytm in the past got stuck up – did not find the help i really needed ? on call you do not even know if the other person is who? First name is America and on one first name there can be a million people having it? duping is more probable online than a real bank always?

  3. 1] I alredy have Airtel Bank Account which is good for Airtel Bill Payments only. Other bills,(like electrcity, etc) which are not in my name, cannot be paid thro’ Airtel Bank. There we have to use Cheque or Cash.Can you elaborate any other uses of Airtel Bank Account?

    2] Can you make a comparative statement of these 4 Digital payment methods. That can help an individual, which option he should select?


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