Facebook, Inc. (NASDAQ: FB) and Google and Infibeam have reportedly teamed up with Reliance Industries. Tech giants joined forces to launch a digital payment network. This is not the first time US-tech giants teamed up with Reliance. FB and GOOGL have also possessed a stake in Jio Platforms.
Earlier yea, the central bank of India has urged the firms to create new Umbrella Entities (NUEs) to establish a new payment platform that can stand against the competitor system run by the NPCI, as it aims to lessen concentration hazards in the space.
NPCI is a non-profit organization that was established in 2008. It has a huge platform and as of March 2019, a large number of banks became its investors. The investors of NPCI include Citibank, HSBC, and State Bank of India. It handles billions of dollars in payments every day through services that involve digital payments, inter-bank fund transfers, and ATM transactions.
Furthermore, as per the Assocham-PWC India study in 2019, Digital payments in India could increase by $135.2 billion in 2023. Sources disclosed that the group headed by Reliance and Infibeam was in the advanced stages of presenting their proposal to the Reserve Bank of India (RBI). RBI has also increased the last date of submission of NUE applications until March 31 from February 26.
Moreover, there are chances that RBI will take an additional six months to examine all the applications being presented and that it is not likely to provide more than two new “for-profit” NUE licenses. FB and Google haven’t shared the official statement yet.