Markets News

RBI extends deadline to file application to set up a New Umbrella Entity

RBI has extended deadline to file application to set up an umbrella entity for retail payments till March 31, 2021.

Previously, the Reserve Bank of India had given time till February 26, 2021.

The consortium of Axis Bank, ICICI Bank, Amazon and Visa, including Tata group will form a pan-India entity.

Moreover, RBI had released the framework to set up a New Umbrella Entity for various payment services last year.

State Bank of India also plans to be stakeholder in New Umbrella Entity as per reports.

The aim is to create a Not for profit NPCI like body for retail payments.

Further, RBI’s objective is to develop a network parallel to NPCI through this framework.

This is to maintain interoperability with services like UPI and augment innovation and inclusion in the payments space.

However, institutions need time to prepare before they apply according to bankers.

It is imperative to make the system more efficient to tap vast business opportunity.

Those with collaboration with IT firms have an added advantage over others.

Founders of So Hum Bharat are looking forward to apply for RBI’s NUE license as well.

YES Bank had also shown interest in picking up a stake in So Hum Bharat.

Both State Bank of India and Bank of Baroda are in talks to form company for retail payments.

Private sector lenders HDFC Bank and Kotak Mahindra Bank have picked up stakes too in the company Ferbine Private Ltd.

Tata Sons has however promoted this company.

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