RAS question
The Payments Regulatory Board (PRB), constituted under the Payment and Settlement Systems Act, 2007, is chaired by which authority?
Correct answer: (B) Governor of the Reserve Bank of India.
The Payments Regulatory Board constituted under the Payment and Settlement Systems Act, 2007 is chaired ex officio by the Governor of the Reserve Bank of India.
Explanation
The Payments Regulatory Board sits inside the statutory scheme of the Payment and Settlement Systems Act, 2007. Section 3 makes the Reserve Bank of India the designated authority for regulating and supervising payment systems, and says the Reserve Bank exercises those powers through the Payments Regulatory Board. The same provision lists the Board's composition and names the Governor of the Reserve Bank as its ex officio Chairperson. This matches the practical position noted in the question's explanation: RBI Governor Sanjay Malhotra chaired the Board's inaugural meeting in Mumbai in January 2026. The Board replaced the earlier BPSS framework and has six members connected with payment-system safety, efficiency and stability.
Why the other options are wrong
- (A) The Union Finance Minister is not named as Chairperson; the Act places payment-system regulation with the Reserve Bank acting through the Payments Regulatory Board.
- (C) The Secretary, Department of Financial Services is not the statutory Chairperson; Section 3 specifically assigns the chair to the RBI Governor.
- (D) The Chairman of SEBI regulates securities markets, while this Act excludes stock exchanges from its payment-system definition and names the RBI Governor as PRB Chairperson.
Concept
This tests statutory regulators and the institutional design of financial governance. RAS often asks who chairs a board or authority because the answer reveals where regulatory power is legally located.