The euphoria over building the next NPCI

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Editor's note: On 19 August, the Reserve Bank of India released its final guidelines allowing companies to apply for licences to operate payment systems. In the three weeks since, the digital payments market has gone from pandemic lockdown mode to frenzied activity. Going by accounts from multiple industry executives, several payments and financial companies have actively started exploring this new game and some are even in serious partnership talks with domestic and global players. Interest has been simmering since RBI first announced in February that it would allow the creation of new entities to manage pan-India payments networks (which we wrote about here). A quick recap, if you need it: Almost all retail payments systems in India are operated by the National Payments Corporation of India, a not-for-profit company owned by a broad consortium of banks, with a majority stake held by state-owned banks, making it indirectly a government institution. The systems operated by NPCI include the national ATM network, the RuPay card network, the Bharat Billpay platform and most prominently the Unified Payments Interface, or UPI, to name but a few. …