The Ministry of Finance has notified in writing that Sections 152 and 153 of the Finance Act, 2017, which modify the Payment and Settlement Systems Act, 2007, will be effective from May 9, 2025. The notification came through Notification S.O. 2031(E), dated 6th May 2025, released by the Department of Financial Services.

These provisions, introduced under the Finance Act, 2017, are intended to tighten the regulatory environment overseeing digital payments and settlement systems in India. Although the precise nature of the amendments under Sections 152 and 153 has not been rehearsed in the most recent notification, they are known to grant stronger control and operational transparency in the increasingly dynamic fintech and digital transactions arena.

The amendments will strengthen the Reserve Bank of India (RBI) powers to oversee and regulate payment systems, better consumer protection arrangements, and enable secure, efficient, and accessible digital financial infrastructure.

The notification activates a major governance reform in India’s payment systems landscape by: Reorganizing regulatory oversight through a dedicated Payments Regulatory Board. Strengthening RBI’s role by institutionalizing its authority through a formal board structure. Ensuring representation from both RBI and the Central Government, which balances monetary policy considerations and broader financial system governance. Providing a clear statutory framework for decision-making and accountability in the regulation of digital payments, clearing, and settlement systems.