Fino Paytech announced that it has received the final license from Reserve Bank of India (RBI) to set up a payments bank. The entity will be called Fino Payments Bank. Earlier in January this year, Fino closed its Rs 400 crore domestic fund raising exercise that helped it meet key RBI guidelines, including reducing foreign shareholding in the company.
Fino Payments Bank will have a mix of physical and digital platforms along with a network of access points to increase reach and convenience to its customers. Though the company did not mention a date when it would launch its payments bank or mention more details.
Fino Paytech raised an additional Rs 149 crore in funding from ICICI Prudential Life Insurance and ICICI Lombard General Insurance among other investors. The company had earlier raised Rs 251 crore from oil marketing company Bharat Petroleum Corporation Limited (BPCL) for increasing domestic investment.
RBI’s guidelines, the foreign shareholding in the payments bank would be as per the Foreign Direct Investment (FDI) policy for private sector banks. The aggregate foreign investment in a private sector bank from all sources will be allowed upto a maximum of 74% of the paid-up capital of the bank.
RBI had permitted 11 entities to start a payments bank and the list is down to eight. Tech Mahindra, Cholamandalam Investment and Finance company and Sun Pharma promoter Dilip Shanghvi surrendered their payments bank licence last year.
Paytm got its payments bank license from the RBI earlier in January, while the department of posts launched India Post Payments Bank (IPPB) on a pilot basis. Meanwhile, Airtel has launched its payments bank operations in and is aiming for a pure digital bank play. Airtel Payments Bank said its customers would not get a physical debit card, but it had tied up with MasterCard to issue a virtual card which could be used for online spends.