Mumbai: Paytm Payments Bank Ltd on Tuesday rolled out its banking operations. With the launch of Paytm Payments Bank, there are now three payments bank in the country, including Airtel Payments Bank Ltd and India Post Payments Bank Ltd.
Payments bank is a differentiated bank which allows customers to open a savings account for a deposit amount of up to Rs1 lakh. As of now, Paytm Payments Bank is offering the service by invitation only.
Here is a look at the products and services all the payments banks offer and what you should know before you opt for it:
The newly launched Paytm Payments Bank is offering 4% interest rate on savings account. Its competitor Airtel Payments Bank is giving 7.25% interest on deposits in savings accounts, while India Post Payments Bank is providing 5.5% interest on deposits depending on the amount.
Paytm Payments Bank’s interest rate is in line with all the large commercial banks, including State Bank of India, Bank of Baroda and ICICI Bank Ltd, which continue to offer 4% interest rate on savings account deposits. Some of the smaller banks, including Yes Bank Ltd and RBL Bank Ltd, offer 5.5-7.1% interest rate on savings accounts, depending on the deposit amount.
India Post Payments Bank is offering three kinds of accounts: one regular and two basic savings bank deposit accounts.
Cash withdrawal charges
For most payments banks, there is a cash withdrawal charge.
Paytm Payments Bank’s cash withdrawal charges using the ATM is similar to any other major bank of the country. You will get five free transactions in non-metro cities and three free transactions in a metro city, after which you will be charged Rs20 for each cash withdrawal and Rs5 for non-financial transactions like taking out a mini statement. In case you need a physical statement from the bank, you will have to pay Rs50 plus delivery charges; additional service tax will also be applicable.
Airtel Payments Bank will charge 0.65% of the withdrawal amount if you withdraw cash from a banking point.
India Post Payments Bank will not charge any fee if you withdraw money using an ATM card at India Post Payments Bank ATM or Punjab National Bank ATM. However, for withdrawals from other bank ATMs, you will be charged as per standard Reserve Bank of India (RBI) rules—you will get five free transactions in non-metro cities and three free transactions in metro cities, after which you will be charged Rs20 for financial transactions and Rs8 for non-financial transactions. For doorstep banking, where the bank delivers cash at the customers doorstep, cash deposit and withdrawal charges range between Rs15 and Rs35, depending on the amount