Jio Financial Services (JFS), a recent spinoff from Reliance Industries Ltd (RIL), has received approval from the Reserve Bank of India (RBI) to transition from a non-banking financial company (NBFC) to a core investment company (CIC).
This shift follows a regulatory mandate and was announced in an exchange filing.
JFS, which demerged from RIL in July and was listed on the stock exchanges in August, has emerged as a significant competitor in the fintech sector, spanning payments, insurance, and asset management.
The company’s deep financial resources position it as a formidable player against fintech startups across these segments.
On November 21, JFS reported submitting an application to the RBI to transition from an NBFC to a CIC.
This move is intended to alter its shareholding pattern and control post-demerger in accordance with RBI regulations.
CICs, as defined by the RBI, primarily invest in their group entities through various financial instruments like equity, preference shares, convertibles, or loans and serve as passive holding companies to maintain control over their group companies without engaging in other financial activities.
Earlier this year, JFS partnered with BlackRock, the world’s largest asset management company, to enter India’s mutual fund market.
JFS has recently launched a soundbox and a suite of offerings ranging from personal and merchant lending to insurance and retail payments.
The company competes with major fintech entities such as Paytm, PhonePe, BharatPe, PB Fintech, CRED, Zerodha, and Groww.
The company’s consolidated profit after tax (PAT) doubled sequentially to INR 668.2 Cr in Q2 FY24, while its operating revenue saw a quarter-on-quarter increase of over 61% to INR 608 Cr.
