RuPay is pitched as a low-cost alternative to legacy global peers Visa and MasterCard.
Public sector lender Corporation Bank said it will acquire 1.06 per cent stake in National Payments Corporation of India (NPCI), the government body running payment network under the banner RuPay.
The Mangalore-based bank will subscribe to 1,42,000 shares representing 1.06 per cent stake in the retail payments system at Rs 352 per equity share having a face value of Rs 100 each. The total transaction amount will be Rs 4.99 crore and will value the payments system at around Rs 471 crore ($70 million).
NPCI, which was incorporated in 2008, has become one of the largest payments networks in the country over the past few years. The company has been giving stiff competition to legacy global peers MasterCard and Visa through its payment platform RuPay and has been successfully able to integrate its services with the government’s unique identification project and Jan Dhan Yojana.
The company—which counts Nandan Nilekani, co-founder of Infosys and former chairman of Unique Identification Authority of India, as its advisor—plans to roll out its payments interface project which will allow easier interface for customers to transfer money and make payments in April.
While it has already made a mark in the debit card banking business—thanks to huge captive consumer base of PSU banks—it also plans to launch a credit card system and is trying to break into the online payment network too to capitalise on the fast growing e-commerce business.
On the other hand, for Corporation Bank this would be the second non-core deal this year. The bank had last week said it will buy 4 per cent stake held by Nomura Asset Management in the Japanese company’s mutual fund joint venture with Life Insurance Corporation and the insurer’s mortgage lending arm.