Payment services operated by the nonbanks were brought under regulation of the Reserve Bank of India after the notification of the Payment and Settlement Systems Act, 2007 and the broad approach has been that these entities will provide fee based services without obtaining access to customer funds (for example, mobile wallets provided by non-banks through the mechanism of the escrow account with a bank).
The Self Help Group-Bank Linkage Program introduced in the 1990s facilitated the formation of tremendous synergies between the formal financial sector and the informal sector. Provision of banking services to the poor households was achieved without relaxation of capital adequacy and other prudential norms for microfinance entities and other institutions.