Google, Amazon & Facebook Planning to Set Up NPCI Rival
Google, Amazon & Facebook are keen to set up their own payments network by tying up with Indian companies, to counter dominance of the NPCI (National Payments Corporation of India).
The move comes after NPCI recently released a notification stating to have 30% cap on third- party UPI transactions from January 2021. As per the notifications, the existing apps will get a span of two years to comply as per the new norms. The new entrants such as WhatsApp pay would have to comply with the cap starting January next year. The decision followed backlash, with various market players saying that the move would hinder country’s thriving digital payments economy.
The digital payments network would be organized as per the guidelines issued by RBI to set up ‘new umbrella entities’ (NUE), back in august. RBI said these new ventures would likely introduce new technologies in payment space. Also, the NUEs would complement NPCI rather than competing or duplicating it.
Even though the plan is still on paper, various organizations and startups are keen to issue NUE license, which will allow them convenience to set up their own Pan-India payments entity.
The tech giants- Google, Amazon and Facebook already have a huge market share in the digital payment space. Setting up their own version of NPCI would help them get better hold of the market share. While Facebook and Google are said to approach Reliance Jio, Amazon is still exploring options. Banks such as SBI and HDFC are also said to keen for this venture.