Govt flags SBI-HDFC Bank-Bank of Baroda’s NUE plan to rival NPCI

Mumbai: The finance ministry has raised concerns over State Bank of India’s plan to set up a joint venture with HDFC Bank Ltd. and Bank of Baroda under the central bank’s new umbrella entity (NUE) framework, worried that it could squeeze the National Payments Corporation of India (NPCI), three people aware of the matter told The Economic Times.

The government doesn’t want public sector banks to set up NUEs that will rival the country’s premier payments entity, the people said. The proposed joint venture led by SBI has been cited by finance ministry officials on the counts of potential competition and monopoly risk, they said.