Reliance, Google, Facebook Will Launch UPI Alternative In India: How Will It Work?
Citing unnamed sources, On Saturday, Economic Times reported that in order to set up a national digital payment network, Reliance Industries is partnering with Facebook Inc, Google and fintech player Infibeam.
There are some concentration risks in a payments space and hence in order to create a payments network, India’s central bank has invited companies to forge new umbrella entities (NUEs). This would rival the system operated by the National Payments Council of India (NPCI).
The National Payments Corporation of India is an umbrella organisation for operating retail payments and settlement systems in India which was set up in 2008.
In 2019, it has State Bank of India, Citibank and HSBC and dozen others as its shareholders. Billions of dollars are processed daily through NPCI. These payments are processed daily via services such as inter-bank fund transfers, ATM transactions and digital payments.
The group which is led by Reliance and Infibeam is in the advanced stages of submitting their proposal to the Reserve Bank of India.
A response was not immediately received by Reliance, Google and Facebook whereas Infibeam declined to comment.
According to a 2019 study by Assocham-PWC India, by 2023 digital payments in India could rise to $135.2 billion.
Reliance partners with Google, Facebook
Facebook and Google are already partnered with Reliance and own stakes in Jio Platforms. Jio Platforms is the unit which houses Reliance’s music, movie apps and telecoms venture.
The previous deadline of February 26 by RBI has been extended till March 31 for all the parties to submit NUE.
The RBI this week extended the deadline for all parties to submit NUE applications until March 31 from February 26.
Not more than two new “for-profit” NUE licences by RBI
Not more than two new “for-profit” NUE licences will be given by RBI and it is expected that the Bank shall take another six months to study all the proposals being submitted by parties.
The RBI did not respond to a request for comment.
The other parties, according to the reports, include a group of Tata Group and private lender HDFC Bank, another of Amazon and ICICI Bank and another of Paytm, Ola & IndusInd Bank.