RAS question
The Payments Regulatory Board (PRB) replaced which earlier body under RBI?
Correct answer: (B) BPSS (Board for Regulation and Supervision of Payment and Settlement Systems).
The Payments Regulatory Board in the Reserve Bank of India replaced the Board for Regulation and Supervision of Payment and Settlement Systems.
Explanation
The earlier RBI body was the Board for Regulation and Supervision of Payment and Settlement Systems, commonly abbreviated as BPSS. The replacement concerned institutional architecture, not monetary policy or grievance redress. The PRB replaced BPSS under the Payment and Settlement Systems Act, 2007, as amended. The RBI Bulletin, in its discussion of structural reforms in Union Budget 2017-18, notes the creation of a Payments Regulatory Board in the Reserve Bank of India by replacing the existing Board for Regulation and Supervision of Payment and Settlement Systems. Option B therefore fits both the statutory context and the official RBI description.
Why the other options are wrong
- (A) The Monetary Policy Committee concerns RBI's monetary policy decisions, while the replacement was of the payment and settlement systems board.
- (C) The Banking Ombudsman Board relates to banking grievance redress, not to the RBI body regulating and supervising payment and settlement systems.
- (D) The Financial Stability Board is not the earlier RBI payment-systems body replaced by the Payments Regulatory Board in the Reserve Bank of India.
Concept
This tests RBI institutional architecture within Indian Economy, especially payment and settlement system regulation. RAS often asks such bodies because reforms are framed through specific boards, Acts and regulatory functions rather than broad policy labels.