Some of the largest names in the worldwide tech space – the likes of Facebook, Google and Amazon – to consortiums formed by domestic corporations like Cholamandalam Investment and Finance Company (Chola), which is the economic services arm of more than Rs 38,000-crore Murugappa Group, will be awaiting the outcome about September when the Reserve Bank of India (RBI) is probably to announce the players who might get the new umbrella entity (NUE) licence for retail payments.
It is nonetheless not clear how numerous licences will ultimately be provided out to set-up, what the central bank describes as “pan-India umbrella entity/entities focussing on retail payment systems.” The essential attraction for most is also apparently that it is to be incorporated as a firm in India beneath the Companies Act, 2013 and probably to be permitted as a ‘for-profit’ entity.
But then, what can possibly attract the worldwide major tech? TheSpuzz Online asked Kishore Biyani, who has seen the space evolve and played an essential function in the Indian retail story. Without wanting to comment on person entities, he feels in an era exactly where worldwide corporations have to compete with China, then it does boil down to a game of footprint and if China comes armed with its numbers then India is the only nation that can offer you a match in terms of buyer touchpoints. So, if for instance, worldwide tech giants from say the US are to get beyond their domestic 300 million buyer base then, some of them, who are currently invested in India like Facebook, Google and Amazon, might discover it only logical way ahead at a time when India has opened up the chance.
“The new age economy is all about owning a customer and the ultimate aim of all the big tech companies is also to own the customer,” says Kishore Biyani. Nitin Chugh, managing director and CEO of Ujjivan Small Finance Bank, says Ujjivan is a member of one of the consortium — Vishwakarma Payments — that has applied for the licence along with the 5 or six such applications for the new umbrella entity (NUE) licence for retail payments. He says, “we are along with Cholamandalam, FSS, Zoho, Zerodha, RazorPay and Airpay.
Also Read: Non-compliance with new guidelines: Facebook, Twitter, WhatsApp run the danger of losing legal immunity
He feels the major implication of this initiative is that “it will offer more options to users.” The underlying argument for most appears that UPI – the payment mode that is utilised in most on-line transactions – is currently attempted and tested and something equivalent by one more payment consortium is anticipated to only give higher decision to customers.
While there is no clarity as however on how numerous licences are probably to be issued by the RBI, the expectation is that by September it will be clear.