State Bank of India (SBI) and Bharti Airtel on Wednesday decided to join hands to form a joint venture to make available banking services to the uncovered population of the country.
A new entity will be floated with an investment of Rs.100 crore to add value to the banking and financial services sector.
The joint venture will become the business correspondent of SBI and offer banking products and services at affordable cost to the citizens.
Business correspondents are persons who, besides helping rural people to open bank accounts, would facilitate in banking transactions. Their key role is to accept deposits and remit money.
In the newly formed joint venture company, SBI will hold 51 per cent stake and Bharti Airtel the balance.
This joint venture will bring together the commitment of the two institutions, which will enable the bank reaching out to every Indian leveraging the distribution network of Airtel to provide banking services,'' SBI Chairman O. P. Bhatt said.
The joint venture as business correspondent will engage Airtel's retailers as customer service points (CSPs) across the country in a phased manner.
The new entity will harness the power of SBI's strengths and Airtel's mobile telephony to add value to the banking and financial services sector. With this joint venture, the existing, new Airtel and other mobile customers will be able to visit these outlets and open new SBI bank accounts and avail themselves of other banking products and services available at the CSPs.
Additionally, the existing SBI customers will get serviced at these outlets. This partnership represents a first-of-its kind collaboration, aimed at making the concept of inclusive banking a reality for customers in India.
This historic collaboration between SBI and Airtel will create scalable operations that will address the banking requirements of millions of Indians through the mobile platform,'' Bharti Airtel Chairman and Managing Director Sunil Bharti Mittal said.