India’s conglomerate Reliance Industries has partnered with Facebook Inc, Google and fintech player Infibeam to set up a national digital payment network, Economic Times newspaper reported on Saturday, citing unnamed sources.
Last year, India’s central bank invited companies to forge new umbrella entities (NUEs) to create a payments network that would rival the system operated by the National Payments Council of India (NPCI), as it seeks to reduce concentration risks in the space.
Set up in 2008, NPCI is a not-for-profit company, which as of March 2019 counted dozens of banks as its shareholders, including the State Bank of India, Citibank and HSBC. It processes billions of dollars in payments daily via services that include inter-bank fund transfers, ATM transactions and digital payments.
Citing three unnamed sources, India’s leading business daily Economic Times said that the group led by Reliance and Infibeam was in the advanced stages of submitting their proposal to the Reserve Bank of India.
A spokesperson for Infibeam declined comment on the report, saying the company was bound by the confidentiality of process, while Reliance, Google and Facebook did not immediately respond to a request for comment.
Digital payments in India could rise to $135.2 billion in 2023, according to an Assocham-PWC India study in 2019.
Facebook and Google are already partnered with Reliance and own stakes in Jio Platforms – the unit which houses Reliance’s music, movie apps and telecoms venture.
The RBI this week extended the deadline for all parties to submit NUE applications until March 31 from February 26.
The report said RBI is expected to take another six months to study all the proposals being submitted and that it is not expected to give more than two new “for-profit” NUE licences.
The RBI did not respond to a request for comment.
Earlier media reports have said other parties in the fray include a group led by Amazon and ICICI Bank; another combination led by the country’s salt-to-software conglomerate Tata Group and private lender HDFC Bank; and a venture involving India’s largest mobile payment platform, Paytm, domestic ride-sharing company Ola and IndusInd Bank.