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Tech Mahindra on Wednesday said its sister company, Mahindra Finance, will become an equal shareholder if the Reserve Bank of India (RBI) clears its payments bank licence.
The company is also in talks with the World Bank Group’s International Finance Corporation (IFC) for a partnership in the foray. “The Mahindra group is also in talks with IFC for a partnership for the payments bank which, if fructified, we will dilute stake,” Tech Mahindra mobility head Jagdish Mitra said.
“We will be forming a separate company and once we get an approval from RBI, Mahindra Finance will become a 50 per cent partner,” he said.
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The investment will be much larger than the Rs 100 crore minimum required by RBI, Mitra added.
“The payments bank floated by the Mahindras wants to learn from the best global experiences, where IFC will be of help with experiences from its investee companies from the world over,” he said. Tech Mahindra is also in talks with mobile operators for a tie-up.
The Reserve Bank accepted applications from over 40 companies/individuals last week for payment banks.
Most of the big telecom players who possess huge distribution networks have entered the fray. Reliance Industries tied up with SBI; Airtel with Kotak Bank.
The group decided to have its technology company at the front-end because there are multiple regulatory approvals which the non-banking financier Mahindra Finance has to go through, Mitra said.
