State Bank of India (SBI) and Hitachi’s subsidiary Hitachi Payment Services Private Limited have signed a definitive agreement to enter into a joint venture for the establishment of a card acceptance and future-ready digital payment platform for India. The JV agreement is subject to requisite regulatory approvals.
According to the release, SBI will have a majority stake in the proposed JV. It will leverage its branch network and its engaged relationship with corporates and government to provide a technology-led superior payment service in the country.
Hitachi Payments provides comprehensive cash and digital payment solutions and has been providing deployment, technology and management services for the card and digital acceptance payment network of SBI since 2011 and has partnered with SBI in a quest to become one of the largest acquiring networks in the country. Backed by Hitachi Payments’ in-house technology platform and widespread field services in the country, SBI has been able to offer innovations to its consumers, including the recently launched MOPAD, a multi-modal payment device.
The JV combines the unparalleled distribution network, customer trust of SBI with cutting-edge technology and services of the Hitachi Group in areas such as digital payments technology, services, big data, analytics, and artificial intelligence. The JV will provide a comprehensive suite of payment options to customers and merchants focusing on areas such as roll-out of a nationwide card acceptance infrastructure, quick response (QR) code acceptance, Unified Payment Interface (UPI), mass transit sector and e-commerce businesses.
Speaking about the joint venture, Rajnish Kumar, Chairman, SBI said, “At 2,500 PoS per million people, the penetration of payment acceptance infrastructure is still low. With this JV, we aim to grow the payment landscape by providing a frictionless modern digital payment platform to our customers. In Hitachi Payments, we see a long-term business and technology partner that has the ability, capability, and willingness to develop the broad vision of SBI which is tied into the success of the digital payment imperatives of the country. SBI also believes that the future of the payment services lies in the capability of the JV to develop new digital acquiring strategies for the benefit of its consumers.”
Toshiaki Higashihara, President & CEO of Hitachi, said, “Along with the accelerating movement of digitization around the world, Hitachi aims to improve people’s lives by providing digital solutions in India and other countries. By establishing a joint venture with SBI, Hitachi will further contribute to the development of digital payments in India by building a state-of-the-art digital payments platform and leveraging SBI’s robust customer network.”
Bharat Kaushal, Managing Director of Hitachi India, said, “Under the India Government’s “Digital India” initiative, India is progressing towards becoming a knowledge economy with technology as the pivot. Hitachi is aiding in the development of India’s social infrastructure as well as giving a fillip to the economy. This mutually benefitting partnership with the financial giant SBI will allow us to widen our footprint pan India.”