Explained: What is NUE licence for retail payments and who's interested?

Customer retention, gains from float money and product innovation are the key reasons for banks to jump on the new for-profit platform for retail payments

In August 2020, when the Reserve Bank of India (RBI) came out with a framework for the authorisation of a pan-India new umbrella entity (NUE) for retail payments, little did it reckon that banks would make a beeline to be a part of the system. News reports suggest that there is an active collaboration among banks, payment banks, fintechs and technology providers to apply for the NUE platform (see table). While the regulator’s intent was to create a parallel to the National Payments Corporation of India (NPCI) so that the present system is decongested, banks’ interest in NUE stems from