Finance Minister Arun Jaitley Tuesday told the Lok Sabha that the bill on payment and settlement systems will increase stability of financial markets in the country in line with the globally accepted norms.Moving the Payment and Settlement Systems (Amendment) Bill 2014 for passage in the house, he said that it seeks to amend some provisions of the Act passed in 2007 and provide that if "a system participant" is declared insolvent by an order of court and authority, it will not affect any settlement that has become final prior to such order or immediately after it.He said that the 2007 Act envisaged that if a system participant (such as a bank) becomes insolvent, it will first pay to those whose money it is holding and provisions of Banking Regulation Act and Companies act will apply subsequently."(This) procedure of insolvency will (now) also apply to system provider (clearing house)," he said.The Payment and Settlement Systems Act, 2007 was enacted for regulation and supervision of payment systems in India and to designate the Reserve Bank of India as the authority for the purpose.
Members from Congress and Trinamool Congress demanded that the bill should be sent to the standing committee but the demand was not accepted by the chair.The bill also seeks to insert new sections including one on protection of funds collected from the customers by the payment system providers.Jaitley also referred to payment system earlier adopted by some radio taxi services such as Uber which has been in the news after a driver attached to the company allegedly raped a 25-year-old business analyst in a cab while dropping her home in north Delhi Friday night.He said the customers registered with private taxi company gave it their credit card number.They were located using internet-based applications following a demand for taxi and the charges were Adebited from their credit card.He said it was found that payment gateways were outside India.He said from Dec 1 this year payment method was through Paytm wallet.