RIL-SBI applies for payment bank license

MUMBAI: Reliance Industries  (RIL) has applied for a payment bank license with the country's top lender State Bank of India (SBI).

In the joint venture, RIL will be the promoter and SBI will be the joint venture partner with equity investment of up to 30 per cent.

The partnership is in accordance with the guidelines for Payments Bank issued by RBI and subject to grant of license by RBI.

The payments bank will leverage SBI’s nationwide distribution network and risk management capabilities along with the substantial investments made by RIL in its retail and telecom businesses.

It will deploy state-of-the-art technology, build scalable infrastructure and create extensive branch and business correspondent network in order to provide last-mile access and intuitive user experience to all sections of society.

On November 27, 2014, RBI had released guidelines for licensing of payments banks. The guidelines will help mobile firms and supermarket chains to enter the banking arena so that they can cater to the needs of individuals and small businesses.

The objectives of establishing payments banks is to supplement the financial inclusion by providing small savings accounts and payments/remittance services to migrant labor workforce, low income households, small businesses, other unorganized sector entities and other users.