Mukesh Ambani-owned Reliance Industries. Paytm, capital market exchanges NSE and BSE are among the best companies interested in securing licenses to own and operate a unit with powers at par with National Payments Corporation of India (NPCI), told several sources who are aware of developments.
The companies have appointed advisors to manage the project and held discussions with RBI at an early stage to explore the possibility of applying for a license under the draft New umbrella unit (NUE) norms, people said attentively.
They said the widespread interest stems from the fact that these companies feel they have the expertise and infrastructure to handle payment settlement at scale, and a license to NUE can help them gain more autonomy and flexibility. Furthermore, it could pave the way for more collaborative products that can determine the future of India’s payment ecosystem. “A device-owned entity in partnership with Facebook could introduce Libra 2.0 digital currency project in a step-by-step manner, with proper approval,” said one of the sources mentioned above. “Those who get approval may well be at the forefront of the next big payment revolution in India.”
A detailed questionnaire sent to RBI, RIL and NSE did not elicit a response, while Paytm and BSE spokesmen declined to comment on this report.
Pr. High-ranking source has several other high-profile companies – a technology giant, global financial technology companies and a consortium of Indian fintechs – also asked to apply for the license when RBI opens the window. However, ET could not independently verify the identity of these companies.
If given the green light, these companies can create a pan-India payment network that can start and manage their own payment systems – in ways similar to how NPCI operates the Unified Payment Interface (UPI) or the National Automated Clearing House (NACH) – once RBI releases the final eligibility guidelines and application. Currently, the process is in consultation phase where regulators have set draft standards for the proposed public property project earlier this year.
The proposed entity would be regulated by the RBI and approved under the Payment and Settlement Systems Act (PSSA) 2007 under the draft guideline. Unlike NPCI, owned by a consortium of top Indian banks, the company may also be a “for-profit” entity.
“Regulators plan to release definitive guidelines, including details of eligibility and management structure, by the end of the year,” another source said. “RBI can award more than one license based on the number of applications and the strength of proposals. The plan is to issue at least a few licenses before the end of the year. ”
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