Exclusive: NPCI onboards 131 new partners including foreign banks; CEO Asbe gets 2 year extension

National Payments Corporation of India or NPCI has been at the forefront of retail payments innovation in India since 2007. While the corporation’s core promoter group consisted of 10 core banks including State Bank of India, Punjab National Bank, ICICI, HDFC and HSBC until 2016, the number of shareholders increased to 56 banks for wider representation form the banking ecosystem.

To bring representation from the overall payments sector, NPCI is now onboarding 131 new partners, as per regulatory filings by the umbrella organisation for operating retail payments and settlement systems in India. Importantly, the corporation’s managing director and chief executive officer Dilip Asbe has got an extension of two more years. Asbe’s term was supposed to expire on 7th Jan 2021  and now he would continue to lead NPCI until January 7th, 2023.

Asbe has been at the helm of the NPCI since January 2018. The non-profit entity has had a stellar growth story under his leadership. According to data sourced from NPCI, UPI volume grew over 13X to over 2 billion in October 2020 from mere 151.83 million in January 2018 when Asbe took over as MD and CEO of NPCI.

Similarly, the volume of inter mobile payments systems or IMPS also grew 3.2X in the past 33 months. NETC FASTag registered 10X growth in volume since Asbe took over as CEO.

The new partners who would join NPCI as partners consist of one public sector bank (India Overseas Bank), five private banks, 40 foreign banks, 10 small finance banks, six payments banks and 80 payments service providers or PSOs.

The private banks joining NPCI as partners include Dhanlaxmi Bank, IDFC, Bandhan Bank, Nainital Bank and IDBI. This is the first time the payments corporation will onboard a clutch of foreign banks which includes well-known names such as Bank of America, Standard Chartered Bank, Industrial & Commercial Bank of China, Barclays and JP Morgan Chase among others.

The six payments banks Paytm, India Post, Fino, Airtel, Jio and NSDL will join NPCI as partners. Payments service providers such as MobiKwik, Ebix, Infibeam Avenues, Amazon Pay along with nine cross border money transfer service providers including Western Union, MoneyGram will also join the corporation as partners. 

According to regulatory filings by NPCI with MCA, the board passed a resolution to approve allotment of 6,50,000 equity shares at an issue price of Rs 1,250 per share to raise Rs 81.65 crore from 131 new partners. Fintrackr estimates that NPCI will be valued in the range of Rs 1,800-1,900 crore following this infusion.  

During the fiscal ended in March 2020, NPCI generated a total income of Rs 1,221.2 crore, registering a nearly 25% increase as compared to income of Rs 980.2 crore it earned in FY19. During the same period profit after taxes have also increased by 26.4% to Rs 387.6 crore in FY20 from Rs 306.6 crore in FY19 on account on increased payments executed on the various retail payment systems for member banks through its services like NFS, CTS, IMPS, RuPay Card, NACH, AePS, UPI, NeTC, BBPS et al.