Telenor Financial Services, IDFC Bank and Dilip Shanghvi have withdrawn their plan to form a payments bank venture in India, according to an official statement. The development could be an indication about Norway-based Telenor’s future plans for the Indian market. The company’s Indian unit hasn’t been able to grow lately due to limited spectrum holdings, and intense competition from incumbent telcos.
The statement said that the decision will be communicated to Reserve Bank of India (RBI). The companies will not pursue the payment bank licence will not be pursued.
“From the day we signed the Letter of Intent, we have worked hard together with our partners to form a company which can meet the demand for basic banking services across India. We are thankful to both IDFC Bank and Dilip Shanghvi for their efforts throughout this process,” Tine Wollebekk, SVP and Head of Telenor Financial Services, said in a joint statement.
“Telenor Financial Services and IDFC Bank have rich experience from offering financial services and the intention of the JV was to combine our expertise to launch a robust payment bank service in India. Following the mutual decision to withdraw these plans, the payment bank license will not be pursued”, Dilip Shanghvi said on behalf of Dilip Shanghvi Family & Associates (DSA) in an official statement.
In September 2015, Dilip Shanghvi as lead applicant along with Telenor Financial Services and IDFC Bank was granted in-principle licence by RBI to form a payments bank in India.
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IDFC Bank’s founder MD and CEO, Rajiv Lall, said, “It was a good experience working with Telenor Financial Services and Dilip Shanghvi over the last year. We thank them for their support and look forward to future associations”, said Dr Rajiv Lall, Founder MD & CEO IDFC Bank.