By Devidutta Tripathy
MUMBAI (Reuters) - Indian energy-to-telecoms conglomerate Reliance Industries (NS:RELI) on Monday joined a list of companies applying to set up a banking network in India, under a new structure the government hopes will extend basic banking to millions.
Reliance, controlled by India's richest man, Mukesh Ambani, said it would join forces with India's largest bank, State Bank of India (NS:SBI) if it is granted a licence to run a network of so-called payments banks.
These banks gather deposits and promote non-cash payments in a country that still largely depends on cash. But they will not lend.
The aim is for payments banks to piggy-back on existing retail or other networks.
"This creates an opportunity," Shinjini Kumar, an executive director at consultants PwC in Mumbai, said.
"It's more like what happened to telecoms or what happened to (fast-moving consumer goods) in the last 15-20 years: they cracked the code of catering to the masses."
Despite having more than three-dozen commercial banks, not counting the Indian operations of foreign lenders and local co-operative banks, banking penetration in a country of 1.25 billion lags many developing countries.
According to research commissioned by the Bill & Melinda Gates Foundation, only 47 percent of Indian adults had a bank account as of 2013-14, of which 25 percent were active.
Those figures predate a financial inclusion drive launched by Prime Minister Narendra Modi last September that has exceeded its target, with 125 million new accounts opened.
The Reserve Bank of India handed out two permits for full-service banks last year in the first licensing process in a decade. This time it had called for applications for two categories: payments banks, aimed at the unbanked population, and small finance banks.
Mobile phone carriers, retailers, prepaid payment card issuers were among those allowed to apply for payment bank permits.
Top telecommunications carrier Bharti Airtel Ltd (NS:BRTI), which had previously said it would partner with Kotak Mahindra Bank (NS:KTKM), confirmed on Monday it had applied.
Among other phone carriers, Vodafone Group Plc's (L:VOD) Indian arm also applied for a payments bank licence, people with direct knowledge said.
Aditya Birla Group's Idea Cellular (NS:IDEA), the third-biggest cellular carrier, also applied in a partnership with its top shareholder.
Future Group, one of India's biggest retailers, said separately it was also in line for a payments bank permit. Infrastructure lender IDFC Ltd (NS:IDFC), which was one of two companies granted bank permits last year, said it could pick up a small equity stake in Future's payments bank.
The Reserve Bank of India did not release a list of applicants or a timeline for responses.