To comply with its guidelines related to recurring online transactions with Additional Factor of Authentication (AFA).
RBI had directed all banks including RRBs, NBFCs, and payment gateways to comply with AFA for automatic recurring payment by March 31, 2021.
BaReNPI, uses a software-based random number generator that makes it more difficult for cyber-attackers to crack down
The RBI now joins an elite club of countries having payment systems which enable round-the-clock funds transfer and settlement of any value.
Jaitley said the choice has now to be "consciously" made between the existing system of substantial cash donations involving unclean money and other transparent options like cheque, online transactions or electoral bonds.
Paytm is the third entity in the country to launch a payments bank after Airtel and India Post.
"To meet the objective of customer convenience with sufficient security for low value transactions, the card-issuing banks will offer the payment authentication solutions of the respective card networks to their customers on an optional basis," RBI said.