Aditya Birla Group closes its banking business
India’s Aditya Birla Payments Bank (ABPB) has decided to discontinue its banking business and surrender its banking licence to the Reserve Bank of India (RBI), the country’s regulator.
It was one of the 11 applicants to receive RBI’s approval to launch a payments bank. ABPB – a joint venture by Aditya Birla Group and Idea Cellular – was launched on 22 February 2018. Aditya Birla Group has an extensive portfolio that spans from metals, textiles, cement to telecommunications.
The bank will take three months to formally shut down all its operations, it is understood. “A lack of funds was the major reason for the closing down of the bank, along with a non-sustainable business model,” an ex-employee of the bank told to to The Economic Times BFSI.
ABPB states on its website that it has made “full and complete arrangements” for return of customer deposits.
The bank had operations across Mumbai, Chennai, Indore, Lucknow and Hyderabad. For its technology, it used Infosys’ Finacle core banking system.
It is understood that of 11 banks granted licence by RBI, only five remain operational today. These are Airtel Payments Bank, Fino Payments Bank, India Post Payments Bank, Paytm Payments Bank and Jio Payments Bank.