Tech Mahindra becomes 3rd player to drop payments bank plan
IT firm Tech Mahindra on Tuesday said it will not pursue its plans to set up payments bank operations in the country, becoming the third player to pull out from the race. “With reference to the earlier communication dated August 20, 2015, about the in-principle approval granted by RBI for setting up a payments bank, Board of Directors of the company have decided that the company will not pursue this opportunity,” it said in a filing to the BSE.
Sun Pharma founder Dilip Shanghvi who along with IDFC Bank and Telenor got in-principle approval from the Reserve Bank for payments bank, also pulled out of the race last week. A couple of months back, Cholamandalam group also dropped plans of setting up a payments bank. “It was a conscious decision that we wanted to be in this business. We still strongly believe that it is a very large unserved market. Over a period of time, we realised amount of aggression that has come to the marketplace which only erodes the margin because it was anyway more about transactions and the volume of transactions with a razor thin margins,” Tech Mahindra Managing Director and CEO C P Gurnani said when asked about the reason for backing out from the race.
“We realised that the business profitability will take a much longer period than what we were willing to invest into and that is the reason,” he added. Alibaba-backed Paytm, Reliance Industries and Airtel would have been Tech Mahindra’s major competitors. Last August, RBI gave in-principle approval to 11 applicants including Department of Posts, Aditya Birla Nuvo, Airtel M Commerce Services, Fino PayTech, National Securities Depository, Reliance Industries, Tech Mahindra and Vodafone m-pesa for setting up payments banks.
M&M makes farm equipment rental services arm Trringo fully owned
Mahindra & Mahindra (M&M) on Tuesday said it has incorporated its agricultural equipment rental services arm Trringo.com as a wholly-owned subsidiary. “Trringo.com is incorporated as a wholly-owned subsidiary of M&M with an initial subscription of 50,000 shares of Rs 10 each aggregating Rs 5 lakh,” the Mumbai-based utility vehicle major said in a regulatory filing. An organised farm equipment rental service through a franchise-based model using new-age digital technology, Trringo-com was incorporated on May 23.
Its operations will be initially limited to India. Trringo will use a proprietary digital platform as an enabler to process orders and pass them on to the nearest franchisee through location-based mapping. Franchisee could also tie up with tractor owners in the vicinity enabling them to rent out equipment to farmers on a commission basis. Besides, large farmers who own expensive, high-end equipment can rent out their assets, optimising utilisation based on seasonality, cutting across geographies.