India’s largest software exporter, Tata Consultancy Services (TCS), is in talks with nine of the 11 payments bank licence holders to offer operational solutions, according to a highly placed source at the company.
“We have a solution for payments banks and are taking it to the Indian market,” confirmed N Chandrasekaran, managing director, during an interaction.
TCS has been a key participant for government deals in the domestic market. In the banking sector, it works with most of the leading lenders. State Bank of India, the largest public sector one, has its core banking operations on TCS’ banking platform, Bancs.
In its recent quarterly report, TCS said its banking products were bringing in a good pipeline of orders in emerging markets such as West Asia.
When asked, officials from some of the entities granted a payments bank licence confirmed that apart from TCS, other information technology (IT) companies had approached them for customised solutions. An official from the Dilip Shanghvi group, for instance, said on condition of anonymity that the group was in talks with many vendors from the IT sector for the proposed bank’s requirement, software and hardware; TCS was one of these. An official from Fino Pay Tech also confirmed having been approached by TCS.
According to the Reserve Bank of India (RBI), a payments bank has all the key functionalities of a traditional bank, except offering of loans. It is allowed to accept deposits up to Rs 100,000 per account, payments and remittance services, and internet banking. It may also function as a business correspondent of other banks.
In August, RBI granted a licence to 11 entities for setting up a payments bank, in another 18 months. One is Tech Mahindra, the country’s fourth largest IT company.
Telecom entities Vodafone and Airtel are also included. Among the others are Aditya Birla Nuvo, the Dilip Shanghvi group and Reliance Industries. And, the government’s India Post.
The RBI has stipulated 18 month deadline for these entities to comply with its guidelines and open up bank branches.