Bharti Airtel, Tech Mahindra gain after payments banks nod

Payments banks can issue ATM/debit cards, but not credit cards

Shares of Bharti Airtel, Tech Mahindra were in demand today as these companies got Reserve Bank's nod to set up non-lending payments banks as part of the financial inclusion drive.

Bharti Airtel was up 2.34 per cent to Rs 392.10, while Tech Mahindra gained 2.83 per cent to Rs 575.90 on BSE.

Shares of Aditya Birla Nuvo climbed 3.23 per cent to Rs 2,335.

Companies run by billionaires Mukesh Ambani and Kumar Mangalam Birla as well as telcos Bharti Airtel and Vodafone are among the 11 entities that yesterday got the Reserve Bank's nod to set up payments banks as part of the financial inclusion drive.

Reliance Industries, which had previously announced partnership with State Bank of India, Airtel M Commerce Services Limited, Aditya Birla Nuvo, Vodafone m-pesa, Tech Mahindra and Department of Post got 'in-principle' approval from RBI to set up such niche banks.

Payments bank licence will allow companies to collect deposits (initially up to Rs 1 lakh per individual), offer Internet banking, facilitate money transfers and sell insurance and mutual funds.

Besides, they can issue ATM/debit cards, but not credit cards.