Mumbai: Companies run by billionaires Mukesh Ambani and Kumar Mangalam Birla as well as telcos Bharti Airtel and Vodafone are among the 11 entities that on Wednesday got the Reserve Bank's nod to set up non-lending payments banks as part of the financial inclusion drive.
Reliance Industries, which had previously announced partnership with State Bank of India, Airtel, M Commerce Services Limited, Aditya Birla Nuvo, Vodafone m-pesa, Tech Mahindra and Department of Posts got the 'in-principal' approval from RBI to set up such niche banks.
Sun Pharma promoter Dilip Shantilal Shanghvi and Vijay Shekhar Sharma of PayTM also got approval in their individual capacities.
Besides, Cholamandalam Distribution Services, Fino PayTech, and National Securities Depository (NSDL) also got approval, out of the 41 applicants.
Payments bank licence will allow companies to collect deposits (initially up to Rs 1 lakh per individual), offer Internet banking, facilitate money transfers and sell insurance and mutual funds.
Besides, they can issue ATM/debit cards, but not credit cards.
Commenting on the development, finance minister Arun Jaitley said such banks will ensure more money comes into the banking system and will help reach out to people in rural areas.
"Various banks are looking at increasing their rural reach which includes big banks like SBI; payments banks will help them realize this," he added.
SBI, the country's largest lender, will take as much as 30 per cent in RIL's proposed bank while Bharti Airtel, India's largest telecom operator, plans to give 19.9 per cent stake in the bank to Kotak Mahindra Bank Ltd.
A total of 41 companies had applied for the permit but "some of the entities who did not qualify in this round, could well be successful in future rounds," RBI said, adding that in future it plans to grant such licences "virtually on tap".
Aditya Birla Nuyo Limited has tied up with Idea Cellular which will have 49 per cent stake in the joint venture.
"The 'in-principle' approval granted will be valid for a period of 18 months, during which time the applicants have to comply with the requirements under the guidelines and fulfil the other conditions as may be stipulated by the Reserve Bank," RBI said.