Since 1991, the Indian financial system has seen notable changes. After deregulation, the banking industry is one that is doing particularly well, and success may be directly attributed to large banks. Several significant technical advancements have occurred over the years thanks to RBI reforms. Payment banks and small banks are the two new banking types that the RBI established to the Indian financial sector in 2014. Increased financial inclusion and the distribution of financial products and services to underserved rural areas are the main goals of the introduction of these banks. Payment banks are a brand-new kind of bank that have the ability to reach the great majority of the underbanked and unbanked portions of the population with banking services. This essay discusses the structure of payment banks as well as the advantages that might be anticipated. How this Indian Post Payment Bank will be a notable step in bringing clients into the official financial system, notably migrant workers and those from lower income households. After the initial phase of the Pradhan Mantri Jan Dhan Yojana, the Indian Post Payment Bank will likely represent the second wave of financial inclusion. To provide a general understanding of payment banks, their operating principles, and how the notion of a payments bank strikes two birds with one stone, this study is entirely based on secondary sources. First, it is expanding the digital payment infrastructure in order to further the financial inclusion effort. Second, it promotes the culture of financial technology in Indian banking. The results show promise for expanding financial services and financial inclusion in India, particularly in rural regions and with a primary focus on low-income populations and small companies.