India has established a new Payments Regulatory Board (PRB), a significant move that restructures the oversight of the country’s rapidly expanding digital payments ecosystem.
The formation of the PRB under the Payments Regulatory Board Regulations, 2025, reflects a hybrid model of governance between the Reserve Bank of India (RBI) and the central government, Business World reported.
The PRB will replace the Board for Regulation and Supervision of Payment and Settlement Systems (BPSS), marking the most sweeping overhaul of payments regulation in over a decade.
The RBI Governor will chair the new board, which will include key RBI officials and, for the first time, three members appointed by the central government.
The RBI’s Department of Payment and Settlement Systems will act as the board’s secretariat.
The PRB is designed to meet at least twice annually, with every member holding equal voting rights. In the event of a tie, the RBI Governor, or the Deputy Governor in their absence, will cast the deciding vote.
Legal and technical advisors will also be invited to contribute to discussions.
The reform follows prolonged debate over the independence of payments regulation. A 2018 proposal had sought to establish an external payments regulator, but it was strongly opposed by the RBI, which cited risks to systemic integrity.
The PRB represents a compromise, retaining the RBI’s leadership while introducing greater government participation and subject-matter expertise.
Industry leaders view the reform as a stabilizing force amid surging digital transaction volumes. UPI alone processes over 11 billion transactions each month.
By centralizing regulatory authority, the PRB is expected to enforce unified standards across banks, fintechs, and wallets, improving consumer protection and operational resilience.
Analysts also see potential for the PRB to accelerate innovation. Broader representation could support advancements such as tokenisation, device-based payments, and new umbrella entities (NUEs).