Indian private conglomerate Future Group, which has significant prominence in retail and fashion sectors, is set to apply for a payments banking licence to attract lower-income consumers who do not have bank accounts, The Economic Times has reported.
The group will leverage nearly 2,000 of its touch points in 168 cities and rural locations through Big Bazaar, Nilgiris and Aadhaar Retailing outlets to reach out to depositors for the bank.
It has hired consultancy firm KPMG and HSBC’s global payments and cash management head Navin Gupta to set up the new payments bank. Gupta serves on the board of the National Payments Corporation of India.
The duo will work on various products including deposits, savings accounts and pre-paid cards, remittances and peer-to-peer banking through mobile technology platforms.
Two Future Group officials told the publication, "The group is also in talks with two banks for a potential equity partnership to bring in expertise in governance, treasury operations and a larger portfolio of products for the payments bank. Future Group’s existing set of customers’ physical network can come handy for the banks if a partnership is forged."
As outlined in the November guidelines of Reserve Bank of India, payments banks will help provide small savings accounts and payment and remittance services to various users such as migrant workers, low-income households, small businesses and other unorganised sector entities.
However, these banks will not be able to offer loans and credit facilities, as well as will not be allowed to hold over INR 100,000 per customer or be involved in any credit risk.