Six Consortiums Apply to RBI for NUE Licence

Six consortiums, including those led by Reliance Industries, Tata Group, and Axis-ICICI Bank, submitted applications to the Reserve Bank of India (RBI) to set up a national payments infrastructure rivaling the National Payments Corp of India (NPCI) platform. The other consortiums are led by Paytm, India Post, and Fintech startup iserveU.

The bank consortium is led by Axis Bank and ICICI Bank, with 20 per cent each and co-promoting an entity called MoPay. This consortium also has BillDesk, Pine Labs, Amazon, and Visa with a 15 per cent stake each. A consortium led by Reliance Industries and Infibeam Avenue has also submitted its proposal Wednesday. Facebook and Google are set to have minority stakes in this entity. Tata Group has also applied for the NUE licence through its subsidiary Ferbine Payments. It will own 40 per cent in the entity while Airtel Digital, Mastercard, and Nabard will hold 10 per cent each. Flipkart, through its subsidiary FlipPay, and Naspers-backed PayU will own about 5 per cent each in the Tata entity. HDFC Bank and Kotak Mahindra Bank will hold 9.99 per cent each in Ferbine.

An NUE licence can help the entity gain greater autonomy in processing digital payments in India. That will help establish a firm presence in the financial services ecosystem through value-added lending and insurance services, said senior industry sources. The RBI had last August issued guidelines for corporates to create for-profit NUEs with an aim to foster competition and ‘de-risk’ India’s burgeoning digital payments ecosystem where much of the settlement burden has fallen on the non-profit NPCI over recent years. As per the rules, no single promoter can have over 40 per cent stake, which then must be brought down to less than 25 per cent in five years of operation. The entity also needs a paid-up capital of Rs 500 crore to get RBI nod.

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