After disrupting the telecom space, Mukesh Ambani led organization is all set to step into the payment bank space. The company has formed a 70:30 joint venture with State bank of India and has plans to start its operations before the end of 2017, as reported by Mint.
According to the report, the Payment bank was earlier expected to start operation in October but it got delayed due to RBI asking Jio to demonstrate its capabilities to provide a glitch-free service. Following this, Jio decides to delay the Payment bank launch for a later date in December.
“The RBI wanted to be sure that the payments bank is fully compliant with all the regulations and is able to service its customers efficiently. The demonstrations are being made to assure the regulator that the standards of customer service will be sustainably maintained,” said a Jio official to the same publication. Mint also said that the emails sent by them to SBI and RIL went unanswered.
With this Joint venture, SBI is hoping to reach remote areas using Jio’s vast network. Since Jio’s recently launched feature phone also supports UPI this will prove beneficial to reach the unreached.
As stated earlier, the new venture will be a 70:30 one between Reliance and SBI. That said, with Jio Payments Bank, SBI is looking to expand its network using Jio’s network, especially in rural areas.
“For SBI, Jio Payments Bank will operate as a business correspondent. SBI will have immediate access to Jio customers in unbanked rural areas,” says the report.
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If you remember, Reliance Jio got the nod from RBI to open a payment bank in India some time is August 2015. With this JV between India’s biggest bank and the fastest growing network could prove beneficial for governments push towards a cashless and digital economy.
As of today, Jio subscribers count has crossed 130 million and this partnership with SBI could help it leverage a new base.