Flipkart, Mastercard and PayU will join the Tata Group-led consortium to create a digital payments New Umbrella Entity (NUE), the Economic Times reported. The three entities will buy a 30% stake together in Ferbine Pvt. Ltd, an entity set up by the Tatas that will operate the NUE under the Reserve Bank of India's authorisation. If granted a license the consortium will set up and operate new payments platforms that will compete with the National Payment Corporation of India (NPCI), while also building payments platforms that complement the NPCI's own. While HDFC Bank and Kotak Mahindra Bank each have a 9.9% stake in the entity, Mastercard and Airtel Digital have bought a 10% stake each, Flipkart's FlipPay, and Naspers-backed PayU will each acquire a 5% stake in the Tata led NUE, the report said. It added that Tata's have retained 40% of the company. The HDFC Bank and Kotak Mahindra Bank combine had initially roped in State Bank of India (SBI) to lead the consortium. However, the Finance Ministry intervened stating that they do not want public sector banks setting up competing institutions to the NPCI. It is not clear if the RBI will mandate all members of a NUE consortium, consisting of banks and payment companies, to divest their stake in the NPCI, if any. However, SBI has pushed back and told the government that if it is blocked from joining the race to create a NUE it will impede innovation across the sector. According to the Economic Times,…
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