Reliance Industries Enters into a Joint Venture with State Bank of India

Private conglomerate Reliance Industries Limited (RIL) and the largest Indian banking company State Bank of India (SBI) have agreed to jointly set up a payments bank. RIL and SBI have equity contribution of 70% and 30% respectively in this venture.

In August 2015, 11 companies’ licenses, including RIL and SBI, were approved by the Reserve Bank of India (RBI) to commence a payments bank.

Payments banks

Payments banks offer Internet banking facility, money transfers, and accept deposits of amounts up to 100,000 initially per user. This service would also allow users to sell insurance policies as well as invest in mutual funds with the help of present retail or other networks.

In addition to the aforementioned offerings, payments banks would also enable users to avail of debit cards, or an ATM facility. The banks are not allowed to lend, thereby ruling out the credit card option. These payment banks are instead required to contribute three-fourths of their investment towards government bonds over short-term periods.

The joint venture

The payments banks will provide physical access points, of which 25% must compulsorily be based in the rural sectors of India. Reliance’s contribution to this joint venture is its cutting-edge technology since the brand is well-known for implementing new techniques and being constantly updated. In addition to RIL’s technology, its wide reach, and distribution, which is attributed to the retail and telecom projects it owns, would also prove to be extremely beneficial for the venture.

SBI enjoys an extremely diverse customer base across varying sections of society and is also the most popular one in the country. SBI’s expertise in the banking sector, coupled with RIL’s experience in the telecom and retail industries enable them to offer financial services to millions of customers and small enterprises.

Exploration in Tamil Nadu

Along with its banking venture, Mukesh Ambani led Reliance Industries Limited recently also received the green signal to drill additional wells in Tamil Nadu. This project is being undertaken to determine the sustainability and reservoir capacity of hydrocarbons. The total cost of drilling the eight new wells off the coast in Tamil Nadu is Rs. 800 crore. RIL discovered hydrocarbons in three out of the nine wells it has drilled in the state so far. The project will be undertaken in the DY-III-D5 offshore block and is licensed under the New Exploration Licensing Policy-III.

RIL had partnered with British Gas in the past as part of an unincorporated joint venture in the Panna-Mukta, Mid Tapti and South Tapti blocks, in which it owns a 30% stake. It also owns oil and natural gas blocks in Mahanadi, Cambay Basin, Gujarat Saurashtra, Cauvery Palar and the Krishna Godavari. Additionally, the company also has coal bed methane blocks in Madhya Pradesh and Sohagpur East and West.


Reliance Industries Limited has entered into a joint venture with the State Bank of India to create a payments bank facility. It owns 70% stake in this joint venture. RIL also got the go ahead to drill eight wells in Tamil Nadu to ascertain the presence and viability of hydrocarbons along the Tamil Nadu coast.


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