You are here: Home » Finance » News » Banks
Business Standard

After Cholamandalam, Dilip Shanghvi also drops payments bank plans

Shanghvi, IDFC Bank and Telenor Financial Services expressed interest in coming together to establish a niche bank

Topics
Dilip Shanghvi

Anup Roy  |  Mumbai 

Dilip Shanghvi, MD, Sun Pharmaceutical Industries announces the sealing of merger deal with Ranbaxy, in Mumbai (pic: Suryakant Niwate)
Dilip Shanghvi, MD, Sun Pharmaceutical Industries

Two months after Cholamandalam dropped its plans to float a payments bank, Dilip Shanghvi, IDFC Bank and Telenor Financial Services on Friday said they, too, were not interested in establishing the niche bank either, without giving any reason.

“During the past eight months, representatives of these three partners have worked together to establish relevant frameworks and a governance structure for the proposed joint venture (JV),” a joint statement said.

“Telenor Financial Services and IDFC Bank have rich experience in offering financial services and the intention of the JV was to combine our expertise to launch a robust payments bank service in India. Following the mutual decision to withdraw these plans, the payments bank licence will not be pursued,” said Shanghvi on behalf of Dilip Shanghvi Family & Associates in the statement.

The Reserve Bank of India had given licences to 11 entities on August 19 to float these niche banks that cannot lend, but accept deposits of up to Rs 1 lakh. With Shanghvi-IDFC-Telenor deciding to give back their licence, there will be only nine entities left. These will be Reliance Industries-State Bank of India combine; Aditya Birla Nuvo (Idea Cellular); Airtel; Vodafone; Department of Posts; FINO PayTech; Tech Mahindra; National Securities Depository Ltd; and Paytm (Vijay Shekhar Sharma).

The objective of setting up payments banks was to further financial inclusion. This was to be achieved by providing small savings accounts and payments/remittance services to migrant labour workforce, low-income households, small businesses, etc in this regard.

“From the day we signed the Letter of Intent, we have worked hard together with our partners to form a company, which can meet the demand for basic banking services across India. We are thankful to both IDFC Bank and Dilip Shanghvi for their efforts throughout this process,” said Tine Wollebekk, head of Telenor Financial Services.

“It was a good experience working with Telenor Financial Services and Dilip Shanghvi over the last year. We thank them for their support and look forward to future associations,” said Rajiv Lall, founder and managing director & chief executive officer of IDFC Bank.

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Sat, May 21 2016. 00:20 IST
RECOMMENDED FOR YOU
.