Simultaneously, the company plans to join with a World Bank arm upon obtaining the approval.
Tech Mahindra’s latest decision to make its foray into the payments banking space is believed to be part of a strategy to increase revenue from its small financial services practice.
Tech Mahindra Mobility Business head Jagdish Mitra told The Hindu: "We are currently in talks with IFC (part of the World Bank) and a bunch of telecom companies. We are seeing a lot of interest from potential partners."
In order to establish the payments bank, the company may invest more than INR1bn ($16m) as stipulated by the RBI.
International financial institution IFC offers investment and asset management services to encourage private sector development in developing countries.
The new venture is expected to help Mahindra Finance with loan origination, reported Live Mint.
Last week, the RBI accepted applications from over 40 companies or individuals which are willing to set up payment banks.
The activities of Tech Mahindra are spread across a spectrum, including business support systems (BSS), operations support systems (OSS), network design & engineering, next generation networks, mobility solutions, security consulting and testing.
