In a move designed to boost financial inclusion, the Reserve Bank of India has given "in-principle" approval to 11 applicants - including telcos, tech firms and the country's postal service - seeking to set up so-called payments banks.
Payment banks will be able to take deposits of up to Rs 1 lakh, issue debit and ATM cards, and facilitate online transactions, but are not allowed to lend money.
The RBI says that it received 41 applications, granting in-principle approval to 11 firms which now have 18 months to meet regulations before getting full licenses. More applicants are expected to be approved in the future.
Among the successful bidders are telcos Vodafone M-Pesa and Bharti Airtel, tech firms Fino PayTech and Tech Mahindra, the Department of Posts, and Vijay Shekhar Sharma, the founder of m-commerce outfit Paytm.
India has around 870 million mobile subscribers but just 450 million bank account holders and the RBI says that the "selected applicants have the reach and the technological and financial strength to service hitherto excluded customers across the country".