Saturday, September 25, 2021
HomeBusinessAmbanis, Birlas, Mittal among 113 vying to be niche banks

Ambanis, Birlas, Mittal among 113 vying to be niche banks

At least 113 entities, including top corporates such as RIL, Aditya Birla Group, Airtel, Vodafone and Future Group, have approached the RBI to seek licences for setting up payment or small finance banks.

“72 applications for Small Finance Banks and 41 applications for Payments Banks were received up to the deadline for submission yesterday,” RBI Governor Raghuram Rajan said during a bi-monthly monetary policy review.

Indicating that the final tally may increase, he said “this number excludes applications that might have been received at other venues”.

Rajan said the RBI has formed two external committees to evaluate applications received, but did not say how many licences will be issued by the central bank in both the categories.

“As stated in the guidelines, two External Advisory Committees (EACs) will evaluate the applications received for setting up of small finance and payments banks and thereafter make their recommendations to the Reserve Bank,” he said.

The EACs for small finance banks and payments banks will be chaired by former RBI Deputy Governor Usha Thorat, and Nachiket Mor, Director, Central Board of RBI, respectively.

Payments banks would be allowed payments and remittance services through various channels. However, such lenders, cannot issue credit cards or undertake lending activities.

Small Finance Banks will primarily undertake basic banking activities of acceptance of deposits and lending to unserved and under-served sections including small business units, small and marginal farmers, micro and small industries and unorganised sector entities.

To foray into banking business through Payments Banks route, Mukesh Ambani-led Reliance Industries has managed a sort of coup by partnering banking behemoth SBI, the only state-run entity in the fray.

Sunil Mittal-promoted Bharti Airtel has signed on private sector lender Kotak Mahindra Bank as a partner for its own payments bank, while Kishore Biyani-led Future Group has teamed up with IDFC, which was given full-fledged banking licence in April last year but is yet to make that venture operational.

Those having applied for setting up small finance banks include micro-lender SKS Microfinance, brokerage firm India Infoline, remittance provider UAE Exchange, home loan provider Dewan Housing Finance and SE Investments.

The applicants for payments banks category also include Fino Paytech and Vakrangee, while sources said that there are some more entities in fray including telecom giant Vodafone.

Some of the applicants, including Aditya Birla Group, India Infoline and UAE Exchange had also applied for full-fledged banking licences to RBI in 2013, but their applications failed to pass the muster.

Most Popular

- Advertisment -[the_ad id="220709"]