RBI has been studying the diverse digital banking intermediaries . These entities must be defined, and their compliance norms be spelled out. Such entities include neo-bunks, open banks, embedded finance companies and API banking organisations. There could be light touch regulatory provisions. These could be enforced by the licensed lenders with whom they partner. Thus the onus will be put either on NBFCs or banks who deal with such entities. In this space, there are startups such as Open, RazorPay, and Niyo. There are global neo-banks such as Revolut. There are big corporations such as Amazon and Tata who want to scale up neo-banking.

These entities currently are loosely regulated. Their business models are different. Their regulation is through the banks they are partnering with. A neo-bank opening a bank account of a corporate must have a business correspondent license. There could be a payment aggregator license. Digital banking entities call themselves TSPs or third-party service providers. They build the services for a licensed player. They act as a platform or technology facilitator.

There could be an independent body called self-Regulatory Organisatory (SRO). It could enforce regulation.